EVs in America: Politics, Profits, and the Challenges They Face
The incoming administration is poised to make big changes that have the potential to impact electric vehicle adoption in the U.S.
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Electric vehicles were often raised as an issue during the 2024 U.S. presidential campaign. President-elect Donald Trump strongly opposed the so-called "electric vehicle mandate," vowing to dismantle it on his first day in office. He has pledged to expand domestic oil production and roll back EPA regulations aimed at ensuring the majority of new car sales are electric by 2032, and his transition team is exploring ways to eliminate the $7,500 federal tax credit for EV purchases.
President Biden, by contrast, has been a strong proponent of electric vehicles during his time in office. His administration championed the Inflation Reduction Act and the Bipartisan Infrastructure Law, both of which allocated substantial investments and incentives to accelerate EV adoption. The Infrastructure Law earmarked $7.5 billion to establish a nationwide EV charging network, and the $7,500 federal tax credit for new EV buyers was a cornerstone of Biden's EV achievements.
Trump's victory will likely have big impacts in electric vehicle adoption in the U.S. Though EV growth is expected to continue, the ambitious policies and regulations designed to accelerate that momentum will likely be dismantled. This shift comes as China is solidifying its dominance in the EV space, leaving the U.S. at a critical crossroads: Either invest strategically to compete on the global stage or risk ceding even greater market share to China.
During the production of MotorTrend Investigates: America’s EV Problems this summer, I interviewed two Republican lawmakers to discuss public policy surrounding EVs, federal spending, and the clean energy transition. To provide balance, I also extended interview requests to Democratic lawmakers, senators, the Department of Energy, the Department of Transportation, and the White House, but these requests were either declined or went unanswered.
Let the Market Decide
Rep. Bruce Westerman, chair of the Natural Resources Committee, echoes the broader Republican stance that the market, not government mandates, should dictate consumer vehicle choices. He criticized the EPA's stringent regulations and California's policy to ban sales of internal combustion vehicles by 2035, a move that has been subsequently adopted by 11 other states. "Let's let the market dictate what kind of cars the American consumer drives," Westerman stated during our interview.
Rep. John Duarte, a Republican from California, shares a similar perspective. "We're simply saying we're not going to mandate to working families what kind of car they need to drive regardless of their preference and regardless of the economics," he explained. Duarte acknowledged the federal government's role in supporting technology, research, and early-stage prototyping, but cautioned against excessive market intervention. "We can help these things along, but we should not be putting such a massive amount of money into the marketplace that it attempts to manipulate consumer demand. That is destructive, and American working families are feeling that on their backs," he said.
Westerman highlighted the substantial federal investment in EVs, estimating that upwards of $140 billion has been spent on subsidies. He pointed to recent grants from the Biden administration, which awarded over $1 billion to General Motors, Stellantis, and ZF North America to transition facilities from traditional manufacturing to EV production and prevent plant closures. According to The Detroit News, these grants aim to retain 15,000 existing jobs while creating an additional 2,900 positions.
EV market share hit a record 8.9 percent in the third quarter of 2024, but the pace of adoption is beginning to slow. Compounding this challenge, some automakers continue to incur significant losses on EV sales. Earlier this year, Ford's EV division, Model e, reported a $2.5-billion loss for the first half of this year, prompting the company to cancel plans for a three-row electric SUV and delay the opening of a planned EV factory in Tennessee. Similarly, Volvo, which had pledged to transition to an all-electric lineup by 2030, has scaled back those ambitions.
The Climate Solution
Electric vehicles are often touted as a crucial solution for reducing greenhouse gas emissions, but Westerman argues that the priority should be expanding clean energy infrastructure, particularly through building nuclear power plants, before focusing on widespread EV adoption. Currently, only 40 percent of the U.S. electric grid is powered by non-carbon-emitting sources, which Westerman sees as a significant limitation. He suggested a more balanced approach to energy and transportation policy.
"If you look at government data, 13.49 percent of global greenhouse gas emissions come from the United States. Of that, 29 percent comes from all of transportation. Then you look at all of transportation, which includes planes, trains, and automobiles, and only 57 percent of the emissions come from light-duty trucks and passenger vehicles. So now you're down to 2.2 percent of global greenhouse gas emissions [coming] from U.S. light-duty trucks and passenger vehicles," Westerman said.
The Arkansas representative expressed his support for electric vehicles and their technology but emphasized a different approach to reducing carbon emissions. "The focus should be on developing the electrical generating and transmitting capacity, and then EVs should come on the tail end of that. We're trying to get the cart ahead of the horse," he explained.
The Role of China
China is the dominant force in the global electric vehicle market, leading the world in the processing and refining of battery minerals while also creating production capacity by building affordable EVs. In response, the Biden administration has imposed 100-percent tariffs on all EVs imported from China, and recently labeled Chinese-connected vehicles a national security threat, banning their importation and sale in the U.S. Meanwhile, with Chinese automakers planning to establish manufacturing plants in Mexico, president-elect Trump has campaigned for a 200-percent tariff on Chinese cars entering the U.S. from Mexico.
"China is a geopolitical rival of the United States. They do not have our best interests at heart. They do not play fair with access to their markets. And I would want to see anything Chinese coming to America be scrutinized for its geopolitical and political ramifications, as well as whatever the supply chain efficiencies and free trade issues may be," Duarte said.
Chinese automakers have made significant inroads in Europe and Latin America. Recently, Europe imposed tariffs on Chinese-made EVs, but some Chinese manufacturers are exploring the possibility of building plants within Europe to circumvent these tariffs. Earlier this month, Reuters reported that Chinese battery giant CATL has expressed interest in establishing a U.S. plant, contingent on approval from the incoming Trump administration. During his campaign, Trump indicated he would be willing to allow Chinese automakers to set up factories in the U.S. and employ American workers.
The Uncertain Future
Though the EV market is expected to keep growing, automakers are grappling with uncertainty due to shifting regulations coming from Washington. Automakers are currently developing products set for release in the next four to six years, and many had adjusted their strategies to align with the stringent rules imposed by the Biden administration. Now, with president-elect Trump pledging to dismantle those regulations, automakers face significant challenges as they look for new ways to make EVs profitable in an evolving and unpredictable regulatory landscape.
Both Democratic and Republican lawmakers generally support electric vehicles, but they differ significantly on issues of government spending and how best to achieve carbon emission reduction goals. Bridging these differences and working toward a unified approach may prove challenging. However, with the right policies, America has the potential to take a leading role in electric vehicle manufacturing, much like it did for gas-powered cars when Henry Ford revolutionized production with the assembly line.
Miguel Cortina is Mexico Editor at MotorTrend, covering the auto industry in the U.S. and south of the border. He joined MotorTrend in January 2015 and is an avid automotive enthusiast who enjoys playing golf, surfing, and running in his free time.
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