Increasing the price of gas would incentivize more efficient vehicles for sure, but it is also incredibly regressive, impacting lower-income individuals disproportionately.
The rich keep driving their Escalades since it makes little difference to them what the gas costs, but the poor can't afford to get to work... To the extent possible, it's best to try to avoid externalities like this, making a gas tax less appealing than it would otherwise be, free market or no.
Use the proceeds to further subsidize and increase the coverage of public transit to make getting to work cheaper. A gas, or carbon (if you want to get closest to the raw input as possible) tax would probably be the best price signal to what you want to reduce demand for.
Forcing automakers to sell more EV's also makes cars more expensive. So then people don't buy new cars and continue to use old ones, the worst emission offenders?
Don't get me wrong - I'm a huge proponent of well-funded, and extensive public transit options... If you are advocating an expansion of public transit to counter the gas tax, I fear it may be more complicated than tit for tat...
In Seattle, where I live, for example, it is logistically and financially expensive to expand public transit. While the city is building out light rail, adding trolleys, and encouraging density, the city is growing too quickly for public investment to keep up. Moreover, the success of Amazon, Microsoft, etc. in adding great, high-paying jobs has the side effect of making the downtown core (where all the transit is) prohibitively expensive to live in.
More externalities... Thus, it comes to be that the poorer working class live further away, have to drive into the city for work, and would still be the hardest hit by a gas tax. Meanwhie, Microsoft provides a private bus/shuttle network to get its employees around from homes to its various campuses - the very people who could afford the extra cost of fuel.
None of this is bad, per se... It's great that there are all these good jobs available and that so many people are flocking to the city! The knock-on effects are to the detriment of the 50% living below the mean...
If we had some kind of basic income, gas taxes, road use fees, parking fees, and many other prices attached to negative externalities (e.g. general carbon taxes) would be much more palatable at a societal level.
If only, the gas tax is waaaaaaaaaay too low.