Summary
The Trump transition team plans to dismantle key support for the US electric vehicle (EV) market by eliminating the $7,500 federal EV tax credit and diverting funds from EV charging stations to securing battery materials as a “national-defense issue.”
This marks a major shift from Biden’s policies, which prioritized rapid EV adoption and a domestic battery supply chain.
The plan includes imposing tariffs on battery parts and materials globally, with possible exemptions for allies.
These changes are expected to slow US EV growth, further widening the gap with Europe and China.
It won’t necessarily destroy the EV market, but it will make it less competitive. Elon Musk is ok with ending the Federal tax credit because he believes it will hurt Tesla’s competitors more than it will hurt Tesla, and that will help Tesla get closer to full monopoly power. Nearly 50% of all EVs sold are Teslas, I expect that to go up.
The company that I think has the best chance to compete with Tesla is GM. Their Ultium platform will allow them to deliver quality EVs at affordable prices. As of Q3 2024, GM is selling the second most EVs, though they are still only selling a fraction of Tesla’s numbers.
For EVs, affordability is key, and GM has positioned themselves well to compete with Tesla on price. However, the GM brands aren’t exactly the most popular, and it’s hard to say if GM will be able to overcome that and convince American EV buyers that GM EVs are worth considering. Which is unfortunate, because GM, of all the legacy, domestic auto makers, has committed themselves to EVs the most.
Oh…that will change. Most people that are progressive enough to purchase electric vehicles are not buying new Tesla’s. I mean, hell, look at the regret that some people have over it (“I purchased this before Elon went crazy!”, etc.).