Emphasizing on reducing subsidies and reallocating money toward local battery manufacture, President-elect Donald Trump's transition team is suggesting to reverse Biden administration's electric vehicle policy. A paper seen by Reuters indicates that the team aims to cancel the $7,500 tax credit for EV purchases and redirect funds from charging infrastructure projects to improve the U.S. military supply chain.
To lessen reliance on outside sources, the ideas include for taxing imported battery components with exemptions negotiated for ally countries. The team also intends to relax limitations on internal combustion engines, returning emissions criteria to 2019 levels, therefore restricting states like California from imposing more stringent policies.
Uncertainty surrounds the car sector, which has spent more than $160 billion on EV manufacturing since 2021. With projects valued at $13.9 billion and $7.6 billion respectively, automakers like Toyota (TM, Financials) and Tesla (TSLA, Financials) keep increasing electric vehicle manufacture, positioning themselves as leaders in the space. Because of declining demand, local manufacturers are cutting EV output even with these expenditures.
Eliminating subsidies and lowering emissions regulations might, industry organizations warn, impede EV acceptance and influence customer decisions. The plans challenge the speed of the industry's shift to greener energy cars because they clearly deviate from the Biden administration's emphasis on speeding EV adoption via incentives and infrastructure, according to some pundits.
