President Donald Trump has taken a decisive step against the electric vehicle (EV) policies initiated by the Biden administration. Signing an executive order, Trump pledged to dismantle what he inaccurately termed as the “electric vehicle mandate.” This move aligns with his campaign promises to reverse the focus on EVs championed by President Biden and Democrats, a stance Trump has consistently labeled as “preposterous.” This action, coupled with anticipated further measures under a second Trump term, signals a potential slowdown in the United States’ progress towards addressing climate change, a significant portion of which stems from the combustion of gasoline and diesel fuels in vehicles.
WATCH: How the next generation of auto techs is preparing for the electric vehicle transition
Here’s a deeper look into the specifics of Trump’s executive order and its potential ramifications for the automotive industry and EV adoption.
What Trump’s Order Says About EV Incentives
Trump’s executive order explicitly states its intention to “eliminate the electric vehicle (EV) mandate” to foster genuine consumer choice, deemed crucial for economic growth and innovation. This will be achieved by “removing regulatory barriers to motor vehicle access” and “ensuring a level regulatory playing field for consumer choice in vehicles.” Despite the absence of a formal “mandate” from the Biden administration compelling EV purchases, the previous president’s policies were designed to incentivize both consumers and automakers to transition towards electric vehicles, moving away from traditional gasoline-powered cars.
The “Unleashing American Energy” executive order further outlines the administration’s plans to terminate “state emissions waivers that function to limit sales of gasoline-powered automobiles, where appropriate.” This is a direct reference to California’s waiver, which allows the state to set stricter emission standards and phase out gasoline car sales by 2035, a standard followed by over a dozen other states. Additionally, the order calls for “considering the elimination of unfair subsidies and other ill-conceived government-imposed market distortions that favor EVs over other technologies and effectively mandate their purchase by individuals, private businesses, and government entities alike by rendering other types of vehicles unaffordable.”
The language within this executive order and related actions suggests a strong likelihood of repealing the $7,500 federal tax credit for new EV purchases, a key component of Biden’s 2022 climate law. Furthermore, it indicates a move to roll back the Environmental Protection Agency (EPA) regulations enacted under Biden, which aimed to tighten limits on greenhouse gas emissions and pollutants from both passenger and commercial vehicles. These potential rollbacks could significantly alter the landscape for EV adoption in the US.
READ MORE: Tesla sales dropped 1.1 percent in 2024, in first annual decline since 2011
Notably, prior to this executive order, Trump had seemingly softened his stance on EVs, particularly as he fostered a closer relationship with Tesla CEO Elon Musk. Tesla, despite increasing competition, remains the dominant force in the EV market and holds the highest market capitalization among global automakers. Musk is now reportedly heading a new presidential advisory role focused on government efficiency.
Impact on EV Charging Infrastructure Funding
The executive order also immediately halts billions in federal funding earmarked for EV charging stations. This funding was a critical component of both the Inflation Reduction Act and the Bipartisan Infrastructure Law, landmark legislations championed by the Biden administration in 2022 and 2021 respectively.
WATCH: A look at the economic impact and progress of Biden’s Inflation Reduction Act so far
President Biden had set an ambitious target of establishing 500,000 EV chargers across the US by 2030. While progress has been made, with over 203,000 public charging ports currently operational and nearly 1,000 new ports being added weekly, the future of this expansion is now uncertain. As of late last year, federally funded initiatives had resulted in 214 operational chargers across 12 states and supported 24,800 ongoing projects nationwide, according to the Federal Highway Administration. The funding pause raises concerns about the pace of infrastructure development needed to support widespread EV adoption.
Current EV Policies and Market Status
Under the Biden administration, significant policy frameworks were established to promote EV adoption. A key goal was for electric vehicles to constitute 50% of all new vehicle sales in the US by 2030. To achieve this, programs like the National Electric Vehicle Infrastructure Formula and the Charging and Fueling Infrastructure Discretionary Grant programs were launched, dedicating substantial funding to EV charging infrastructure.
Furthermore, the EPA implemented stringent tailpipe emission limits for passenger vehicles, the most ambitious standards of their kind in the nation. These rules, while allowing automakers flexibility, inherently incentivized a shift towards electrification, projecting that compliance could be achieved with EV sales as low as 30% by 2032, supplemented by more fuel-efficient gasoline vehicles. The National Highway Traffic Safety Administration also set fuel-efficiency standards, requiring new vehicles to average approximately 38 miles per gallon by 2031, a significant increase from 29 MPG in 2024.
WATCH LIVE: Trump expected to announce $500 billion in investments for AI infrastructure
Despite a slowdown in the growth rate of EV sales last year, electric vehicles still represented 8.1% of new vehicle sales in the US, a slight increase from 7.9% the previous year, according to Motorintelligence.com. While EV costs have been gradually decreasing due to manufacturing scaling and battery technology advancements, they remain more expensive upfront compared to traditional gasoline-powered vehicles. This cost factor, combined with policy uncertainty, has led some automakers, like Ford and General Motors, to adjust their EV strategies, signaling a cautious approach to full electrification.
Future Implications and Industry Outlook
In the short term, Trump’s executive order could paradoxically spur a temporary surge in EV sales as consumers rush to capitalize on existing tax credits before potential repeal. However, the long-term implications are far more complex. The rollback of EV incentives and emission standards could hinder the US’s ability to meet its climate goals. Light-duty vehicles are a major source of greenhouse gas emissions in the transportation sector, a significant contributor to overall US emissions.
WATCH: Trump signs 8 executive orders onstage after inaugural parade
Legal challenges are anticipated against any attempts to revise or dismantle existing regulations. Environmental groups and advocates for clean transportation are likely to contest these rollbacks vigorously. Critics argue that these actions will lead to “higher prices, more pollution and weaker competitiveness,” ultimately harming American consumers and the automotive industry’s future.
The automotive industry now faces a period of uncertainty. The direction of EV adoption in the US will heavily depend on the implementation and enforcement of this executive order, as well as any potential legal battles and future policy adjustments. For auto repair professionals and the broader automotive sector, adapting to these shifting policy winds and evolving market dynamics will be crucial in the years to come.
