If you’ve been scrolling through your news feed lately, you’ve probably seen some pretty wild headlines about the "death of the electric car" under the new administration. It’s a lot to take in. Honestly, the relationship between Donald Trump and electric vehicles is way more complicated than just "he hates them." It’s a mix of aggressive policy rollbacks, a very public bromance with Elon Musk, and a lot of talk about "drilling, baby, drill."
Basically, the vibe has shifted from "government-mandated future" to "market-driven choice."
On his first day back in the Oval Office, January 20, 2025, Trump signed an executive order titled “Unleashing American Energy.” That single piece of paper did a lot of heavy lifting. It signaled the end of what Trump calls the "war on internal combustion engines." But what does that actually mean for the car sitting in your driveway—or the one you were planning to buy?
The End of the $7,500 Tax Credit
The biggest gut punch for most regular people was the expiration of the federal EV tax credit. For a while there, you could get up to $7,500 off a new EV or $4,000 off a used one. It made cars like the Tesla Model Y or the Ford F-150 Lightning actually affordable for middle-class families.
Well, that’s gone. As of September 30, 2025, the credits officially expired. The administration accelerated the phase-out, arguing that these were "wasteful subsidies" that distorted the market.
Industry analysts at the Salata Institute had some pretty grim projections about this. They estimated that losing these credits could slash the EV share of new vehicle sales by about 6 percentage points by 2030. If you combine that with pulling back on charging infrastructure, we’re looking at a much slower transition.
Jim Farley, the CEO of Ford, even predicted that EVs could lose half their market share because of this. It’s a massive deal. Without that $7,500 cushion, many people are looking at the price tag of a Mustang Mach-E and just saying, "Nah, I'll stick with gas."
The "Freedom Means Affordable Cars" Initiative
Trump and his Transportation Secretary, Sean Duffy, recently unveiled something they’re calling the "Freedom Means Affordable Cars" initiative. It sounds like a catchy campaign slogan, but it has real teeth.
The core of it is resetting the Corporate Average Fuel Economy (CAFE) standards. Under the previous administration, these standards were getting tighter and tighter, basically forcing car companies to make more EVs to meet the fleet-wide averages.
Trump called these "ridiculous" and "impossible to meet."
The new plan is to increase fuel economy by only about 0.5% per year through 2026. By 2031, the goal is a fleet average of roughly 34.5 miles per gallon. That’s a huge backtrack. The administration claims this will save American families about $1,000 on the average cost of a new vehicle because manufacturers won't have to pour billions into "uneconomic" EV production lines.
The Elon Musk Factor
You can’t talk about Donald Trump and electric vehicles without talking about Elon Musk. It’s the weirdest alliance in tech right now. Musk donated over $250 million to Trump’s 2024 campaign and now co-leads the "Department of Government Efficiency" (DOGE).
You’d think the CEO of the world’s biggest EV company would be screaming about the loss of tax credits, right?
Actually, he’s been weirdly okay with it.
During a Tesla earnings call, Musk admitted that losing the credits would "hurt Tesla slightly" but would be "devastating" for his competitors like Rivian, Lucid, or even the legacy giants like GM and Ford. He’s playing the long game. Tesla has the margins to survive a price war; most other companies don't.
But not everyone in the Tesla world is happy. Investor Ross Gerber has been pretty vocal lately, calling the whole situation a "mess." He argues that Musk’s political ties are actually decelerating the transition to sustainable energy in the US. It’s a valid point. If the government stops building chargers and stops giving out credits, it doesn't matter how cool the Cybertruck is—people will be worried about where to plug it in.
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What's Happening with Charging Stations?
The National Electric Vehicle Infrastructure (NEVI) program was supposed to build a "backbone" of chargers across US highways. The Trump administration has moved to freeze a lot of this funding.
If you live in a big city, you might not notice. But if you’re trying to drive from Chicago to Denver? That "range anxiety" is going to get real very fast.
The argument from the White House is that the private sector should build these stations, not the taxpayers. While that sounds fine in theory, private companies usually don't want to build chargers in rural Wyoming where there are only three EVs in the whole county. This could lead to "charging deserts" that make long-distance EV travel a pain in the neck.
The China Wildcard
Here’s where it gets really interesting. Trump has been a huge proponent of tariffs, especially on Chinese goods. He’s talked about 60% tariffs on China and 20% on Mexico and Canada.
This is a double-edged sword for EVs.
- It protects US carmakers from cheap Chinese EVs (like BYD).
- It makes the batteries much more expensive because we still rely on China for those minerals.
Surprisingly, at a recent Detroit Economic Club meeting, Trump sort of softened his tone. He said, "Let China come in," as long as they build the plants here and hire American workers. It’s a "build it here or pay the price" mentality. If BYD actually opens a factory in Ohio, that could flip the whole industry on its head.
Actionable Insights for You
So, if you’re sitting there wondering if you should still buy an EV in 2026, here is the "no-nonsense" breakdown of what you should actually do:
- Check State Incentives Immediately: The federal credit is dead, but states like California, New York, and Colorado still have their own programs. Some local utilities even offer rebates for home charger installations. Do not assume the price on the sticker is the final price.
- Look at the Used Market: With the new car credits gone, the resale value of EVs has taken a hit. This is bad for sellers but great for you. You can find 2-year-old EVs with plenty of battery life for a fraction of the original cost.
- Lease if You're Unsure: The "leasing loophole" that allowed businesses to claim credits even when consumers couldn't is also under fire. If you can still find a lease deal that bakes in a $7,500 "incentive," take it. It protects you from the plummeting resale values.
- Factor in Home Charging: Don't rely on the government to build public chargers. If you can't charge at home or work, an EV might be a headache for the next few years while the infrastructure funding is frozen.
- Watch the 2026 Midterms: Policy in the US is a pendulum. If the political winds shift in the midterms, some of these "permanent" rollbacks might get challenged or reversed.
The reality is that EVs aren't going away. Companies like VW, Hyundai, and Kia have already spent billions. They can't just flip a switch and go back to 100% gas. But the "gold rush" of government-subsidized electric cars is definitely over for now. It's a buyer's market if you're smart, but the "free money" era is officially in the rearview mirror.
Check your local dealership's inventory; since the credits vanished, some of these cars are sitting on lots longer, and you might be able to negotiate a better deal than you think.