President Donald Trump signed a series of executive orders on Inauguration Day targeting the Biden administration’s electric vehicle (EV) initiatives. The orders eliminate tax credits for EV purchases, federal grants for charging infrastructure, and subsidies for battery production. Trump framed the actions as a move to strengthen the U.S. auto industry, though analysts warn they could hinder competitiveness in a global market increasingly dominated by electric vehicles.
The administration also rescinded Biden’s goal for 50% of new cars sold by 2030 to be electric, plug-in hybrids, or hydrogen-powered. California’s authority to enforce stricter air-quality standards, including mandates for electric vehicle sales, is also under review. California’s current goal is for all new vehicles sold by 2035 to be electric.
Industry experts caution these changes could disrupt automakers’ investments in EV technology. Companies like Rivian, which recently secured a $6 billion federal loan for an electric SUV factory, face new challenges as funding becomes uncertain. Federal loans and grants tied to Biden’s Inflation Reduction Act remain intact, but Trump’s orders could delay further disbursement and force automakers to reevaluate production plans.
Supporters, including the fossil fuel industry, praised Trump’s actions as a win for American energy independence. Critics argue the rollback threatens progress on reducing greenhouse gas emissions and urban air pollution. Environmental groups have vowed to challenge the orders in court, citing procedural concerns.
Auto manufacturers have offered mixed reactions. Stellantis welcomed Trump’s focus on U.S. manufacturing competitiveness, while others, like General Motors, were noncommittal. Tesla CEO Elon Musk, who leads Trump’s newly established Department of Government Efficiency, has not commented on the potential impact of the EV policy shift on his company.
Despite the policy shift, U.S. consumers continue to drive demand for EVs due to lower fuel costs and advanced technology. Analysts warn, however, that eliminating incentives could stall the industry’s progress, allowing global competitors, particularly in China and Europe, to gain market share.
