The electric vehicle (EV) industry is facing a mix of challenges and opportunities as the Trump Administration’s recent policies and tariff announcements take effect in the market. In its first three months, the Trump Administration took several significant actions that caused major reactions by both EV manufacturers and consumers. To name a few, the federal government froze federal funding for charging infrastructure and other EV subsidy programs, imposed tariffs on key trading partners, and announced plans to reverse Biden-Era emissions standards for cars and trucks. Meanwhile, Congress is considering changes to the Inflation Reduction Act (IRA). EV tax credits remain in the eyes of those lawmakers that have long opposed the IRA and have sought to roll-back spending authorized in furtherance of Biden Administration climate goals.
The Trump Administration's stance on EVs is also creating challenges at the state-level. While states like New York and New Jersey are charging forward in pursuit of their state EV deployment goals, some question whether state funding is enough to alleviate the cost barriers that already exist and would increase with the removal of federal EV tax credits.
This edition of EV Roundup highlights several notable updates in the realm of tax credits, proposed legislation, and regulatory and policy changes impacting the EV industry today.
Federal
- The IRA remains a popular target for Republican lawmakers during the budget reconciliation process. Among the most popular candidates for the chopping block is the IRA’s 30D EV consumer tax credit, which provides credits for used clean vehicles, qualified commercial vehicles, and new plug-in EVs. Another tax credit, 45X, provides incentives for domestic production of EVs, batteries, solar panels, and other energy technologies, and faces uncertainty despite bipartisan support. Lawmakers who support the 45X credit have cited the need to boost the U.S. supply chain and compete with China, but some House Republicans want to impose stricter guardrails on Chinese imports and repeal or revise parts of the tax credit during reconciliation. While a growing number of House Republicans support retaining the IRA’s clean energy tax credits, it remains to be seen which credits will make the cut.
- In February, the Federal Highway Administration (FHWA) froze funding for the $5 billion National Electric Vehicle Infrastructure (NEVI) Program, suspended approval of state implementation plans, and suspended new obligations under the NEVI program. According to the FHWA directive , no new obligations may occur under the NEVI Formula Program until the FHWA issues updated final NEVI Formula Program Guidance that aligns with current DOT policies and priorities. FHWA aims to release updated drat NEVI Formula Guidance for public comment in the spring. The suspension is likely to face legal challenges from states and other proponents that support the program.
- The U.S. Environmental Protection Agency (EPA) stated that it will reconsider the agency’s 2024 emissions standards for passenger vehicles and trucks. One such standard would cut passenger vehicle fleetwide tailpipe emissions by nearly 50% by 2032 compared with 2027 projected levels. Cutting such standards is just one of several moves the EPA has announced to undo the emissions standards put in place by the Biden Administration.
State
- On March 12, 2025, the New York State Public Service Commission announced the commencement of its review of the Make-Ready Program, which aims to increase the number of EV charging stations throughout New York. The purpose of the review is to, among other things, evaluate the Program’s effectiveness and progress towards the state’s “plug goals”, which include building out charging infrastructure to enable achievement of the state’s goal that all new light-duty passenger vehicles offered for sale or lease, or sold, or leased, for registration in the state be zero-emissions by 2035, and all new medium- and heavy-duty vehicles be zero-emissions by 2045. The Notice of Commencement of the Make-Ready Program Review requests comments on, among other things, program effectiveness, progress towards plug goals, ramp down of incentive allocations, budget modification, and proprietary technologies. Comments are due by April 11, 2025 in Case 18-E-0138.
- New Jersey is also charging ahead with its clean vehicle programs. Despite potential cuts to federal tax credits, New Jersey recently launched two initiatives to promote EV adoption: Phase III of the New Jersey Zero Emission Incentive Program (NJ ZIP) and the New Jersey Zero Emission Financing Program (NJ ZEV). Phase III of NJ ZIP will provide vouchers ranging from $15,000 (Class 2b vehicles) to $175,000 (Class 8 vehicles) to businesses and institutional organizations to offset the cost of purchasing new, zero emission medium and heavy-duty vehicles. The new, $25 million NJ ZEV program will provide financing for businesses to cover costs associated with purchasing medium and heavy-duty vehicles that are not covered by the NJ ZIP program or other available funding sources. The new initiatives follow the recent announcement that the state has invested $185 million in EV purchase programs already this year to support its goal of registering 330,000 EVs by 2025.
Industry
- The auto industry is responding to the changing policy landscape with adjustments to their EV strategies. Several manufacturers, including General Motors, Ford, Mercedes-Benz, Volvo, and Toyota have softened their EV ambitions due to the reduced financial incentives and slower sales growth. Legacy carmakers are reportedly targeting combined EV sales of $23.7 million in 2030, more than 3 million EVs less than end-of-decade targets announced in 2023. Even Tesla, who saw its annual sales drop in 2024 for the first time in more than a decade, has stopped referring to its goal of delivering 20 million EVs a year by 2030, despite record-fourth quarter deliveries. Others are more optimistic, suggesting that 2025 could be a record year, with consumers seeking to purchase EVs before the changes taking effect in Washington, D.C. affect supply.
- With $60 million funding from NY Green Bank, Revel plans to more than triple its existing public fast-charging network in New York City by adding 267 new charging stalls across nine sites. This funding marks the NY Green Bank’s first EV charging infrastructure transaction. Revel is currently the largest provider of public EV fast charging in New York City and will use the funds to expand its network in Maspeth, Queens; Greenpoint, Brooklyn; Port Morris, Bronx; near LaGuardia Airport and at JFK International Airport.
