President elect, Donald Trump, is reportedly poised to make swift changes to US vehicle policies with EVs in his sights. He will also grant greater freedoms for autonomous cars. No surprises that these moves will benefit his number one cheerleader whose net worth has skyrocketed since the election. His $250 million donation to the orange one will likely go down as the greatest investment in history.
But anyway according to Reuters, Trump’s transition team plans to eliminate the federal tax credit for EVs, currently worth up to US$7500. This incentive applies to North American-built EVs priced under US$55,000 for cars and US$80,000 for pickups and SUVs.
The team reportedly intends to redirect some US$7.5 billion in funding from EV charging infrastructure toward national defense supply chains and critical infrastructure. A transition team document cited by Reuters highlights EV batteries, minerals, and components as “critical to defense production”.
In addition, Trump aims to roll back the US Environmental Protection Agency’s (EPA) emissions and fuel economy standards to 2019 levels. The EPA has previously indicated EVs would need to make up between 35 to 56 per cent of new vehicle sales by 2032 in order to cut emissions, although this is not a mandate.
Trump falsely claimed that the US government has a mandate of 100 per cent EV sales and vowed to repeal such policies if elected. Reuters reports that returning to 2019 regulations would allow vehicles to emit 25 per cent more pollutants and consume up to 15 per cent more fuel compared to 2025 standards.
Other proposals include restricting adversarial nations from accessing US EV battery technology, introducing tariffs to negotiate EV exports, and eliminating the requirement for federal agencies to purchase EVs by 2027.
Trump’s team is also reportedly considering rolling back regulations for autonomous vehicles (AVs). Specifically, they aim to repeal a requirement for crashes involving AVs to be reported to the National Highway Traffic Safety Administration (NHTSA). This rule has been a point of contention for Tesla, whose CEO Elon Musk reportedly contributed over US$250 million to Trump’s election campaign.
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Tesla’s focus on autonomous technology, such as its Autopilot, Full Self-Driving systems, and upcoming Cybercab robotaxi, has put it in the spotlight. Under current reporting rules, Tesla has logged over 1500 incidents with the NHTSA, leading to multiple investigations. Between the rule’s introduction and October 2024, Tesla vehicles accounted for 40 of 45 fatal crashes involving semi-autonomous systems.
While repealing crash reporting requirements would reduce regulatory hurdles for Tesla, Trump’s broader rollback of pro-EV policies could also favor the company. Musk has expressed support for cutting EV tax credits, as this would disproportionately harm Tesla’s competitors, which rely on price advantages to challenge its market dominance.
Following Trump’s November election victory, Tesla’s share prices surged to record highs, reflecting investor optimism over reduced competition and regulatory constraints.
