Air Date: Week of January 24, 2025

Tesla has dominated the electric vehicle industry for over a decade, and the revocation of Biden’s EV subsidies will make competing more difficult for other auto-manufacturers selling in the United States. (Photo: Phillip Pessar, Wikimedia Commons, CC BY 2.0)

One of President Trump’s Day One executive orders commands a reversal of the Biden Administration’s goal for half of vehicles sold in America by 2030 to be electric. Getting rid of the $7,500 EV tax credit and federal funding for charging stations may take acts of Congress, but auto journalist Jim Motavalli tells Living on Earth’s Aynsley O’Neill that already this effort to shift EVs into reverse is making for uncertainty in the US auto industry.

Transcript

CURWOOD: It’s Living on Earth, I’m Steve Curwood.

DOERING: And I’m Jenni Doering.

As part of his Day One executive order titled “Unleashing American Energy” President Trump is commanding a reversal of the Biden Administration’s goal for half of vehicles sold in America by 2030 to be electric. Getting rid of the $7,500 EV tax credit and federal funding for charging stations may take acts of Congress, but already this effort to shift EVs into reverse is making for uncertainty in the US auto industry. To learn more our colleague Aynsley O’Neill talked to Jim Motavalli, who writes about green transportation for Autoweek and Barron’s.

O'NEILL: So, you're joining us from sunny San Diego, where you just test drove an electric jeep. What did you hear from the folks at Jeep about this executive order?

MOTAVALLI: Well, I don't think they're really thrilled that the idea of losing the federal income tax credit. I mean, they're concerned about keeping EV prices down. Everybody who puts out EVs is. Basically, what they told me, is they're gonna wait and see what happens, whether it really goes away. They're gonna see what other automakers do and how they handle it and that will determine their response. I mean, everybody is at the same time selling EVs and trying to compete with Tesla and at the same time facing all these competitive pressures and the business climate is keeps changing. The demand for EVs has not really gone down, but it's not rising as much as they had hoped. So, there's a lot of challenges in trying to get out a new EV and knowing how many of them to build, where to build it, all those things like that. You know, it's very, very tough market right now.

O'NEILL: What would you say is the overall impact of eliminating Biden's electric vehicle Executive Order, what Trump has been referring to as the EV mandate?

MOTAVALLI: What I think is going to happen as a result of this is actually contrary to what Trump himself has said he wants. If he wants to be competitive with China, it seems like this is the wrong way to go about it. His approach is gonna be putting tariffs on Chinese imported vehicles, but by taking away the income tax credit, which, under Biden's IRA very much encourages automakers to build cars in the United States and also to have their battery packs built in the United States, that makes it less likely that automakers will consider the US as a place to locate their battery plants and their car plants. That's exactly the opposite of what he wants. So, I don't quite understand, unless you're operating on some kind of visceral hatred of electric vehicles, why you would take that approach, I don't understand it.

O'NEILL: Jim, what do you make of the President's decision to enact all these orders against electric vehicles?

MOTAVALLI: I think part of it has to do with seeing them in a sort of political light, which, to me is a mistake. They're just cars. They're not left or right, they're not red or blue, and you can put whatever bumper sticker you want on them, they'll represent you whatever your position is.

O'NEILL: [LAUGH] That's a good, that's funny.

MOTAVALLI: That's a good one, right?

O'NEILL: And California has been a driving force when it comes to policy that promotes electric vehicles. How will President Trump's executive order impact California's EV policies?

MOTAVALLI: Well, under Trump one, in his first administration, he tried to take away California's exclusive right to set separate fuel economy standards, which it has, and other states have the right to follow California rather than the federal policy. Trump spent four years trying to get that taken away. He met California in court, it didn't happen. And I think California they are going to be ready. They will have their guns primed and ready. They will take them to court. What the ultimate outcome of that, I couldn't say, but it's not an executive order that will take that away.

O'NEILL: And President Trump has also put a pause on billions of dollars in funding allocated for EV charging stations through the inflation Reduction Act. What impact is that pause going to have on America's electric vehicle landscape?

MOTAVALLI: I think… You could blow that out of proportion. You could think that would have more of an impact than it does. To date as a result of that 5 billion not a whole lot of EV charging stations were opened up. It was moving fairly slowly. A lot of them would have been opened up if he hadn't instituted that order. But it's not like EV charging stands still without federal funding. It's not the critical thing. Tesla, as a matter of fact, has already installed a pretty robust electric charging network around the whole country. And so therefore, if you have a Tesla right now, you could drive it to California from New York, you could drive it from New York to Florida. You wouldn't have too much trouble. That network is easily gonna get you through there. Now, every other automaker is now signed on with the Tesla charging standard. That means within about a year, just about every car on the market will be able to charge at Tesla stations. So that makes it a lot better for charging nationally. There's a number of independent companies that have pursued this as a business, and we have a much more robust National Network of all kinds now than we had a few years ago. It's still not quite adequate. I recently had a fairly painful experience on the New Jersey Turnpike where I started charge there, and they were all shut down, and I ended up trying to find a charger in the middle of the night, but it eventually worked out okay.

O'NEILL: Oh, I'm from New Jersey, Jim, I hope you'll forgive my home state.

MOTAVALLI: [LAUGH] Yeah.

O'NEILL: And Trump also pledged to impose a 25% tariff on all imports from Mexico and Canada. What kind of impact would that have on car pricing?

MOTAVALLI: It'll make cars more expensive. Right now, American automakers have plants in Mexico. They've put them there because they can produce cars at a cheaper rate, and they can also end up charging less for them. That's why they moved to Mexico, to lesser extent, it's why they build in Canada too. It will mean in the long run that automakers will want to locate in the United States if there's no benefit to locating in Mexico, no financial benefit, it will ultimately have that effect. But for consumers it's definitely gonna push up car prices, which are already very high. Like the average car today is something like $48,000 I mean, that's a lot of money for… And this is the average. This is what people pay. You know, the prices are already high, people are feeling the pinch of that and adding those tariffs is going to make that worse.

O'NEILL: Jim, you've been covering electric vehicles for most of your career. How much have we advanced in EV technology and adoption over the years?

MOTAVALLI: It's remarkable. You know, if you go back to, say, 2010 or earlier, a little bit before that, 2005 or so, when the first EVs came out, they were essentially the same technology we had when EVs disappeared in 1920, and they had lead acid batteries in the same kind of range, maybe 40 or 50 miles, because there'd been essentially no real research into electric technology for automobiles in 100 years. So, when the industry started applying its full force into making better batteries and making vehicles that were designed to carry batteries, it's the pace of improvement and the pace of innovation just remarkable to see. And batteries have come way down in cost, cars have gone way up in range. The prices have come way down. The amount of packaging the batteries take is much smaller. The battery packs are now routinely placed under the car, where they give the car a lower center of gravity and better handling. And just EVs are just so much more fun to drive than gas cars, and… They're just better. I mean, in a very short time, the EV has become better than the internal combustion car and that improvement will just continue as every automaker introduces EVs.

O'NEILL: Overall, how are these most recent presidential actions going to impact us electric vehicle competitiveness?

MOTAVALLI: I think it will make us less competitive. If you look at the Chinese and how they're moving, they currently have over 50% EV adoption. Some other countries in Europe, Iceland and Norway are two examples, they have over 90% EV penetration. So effectively they don't have non-EV sales anymore. China is moving in that direction, and really fast, because they have, they can pretty much command what's going to happen. And the pace at which new EV companies are arising in China is just amazing to see. I was just at the Consumer Electronics Show, and there was another new Chinese EV maker exhibiting there. So, I think the US is in danger of falling behind Europe and China in terms of EV adoption and EV leadership. You could say the world EV leader has been Tesla up until this point, but there's Chinese automakers that are threatening that.

DOERING: That’s auto journalist Jim Motavalli speaking with Living on Earth’s Aynsley O’Neill.

 

Links

Inside Climate News | “Executive Orders on Energy and Climate Have Advocates Across the Nation on Edge”

Inside Climate News | “Buckle Up for a ‘Weird Moment’ in the U.S. Electric Vehicle Market, Even as Global Sales Have Soared”

CBS | “Michigan auto expert speaks on potential impact of tariffs on car prices”

The New York Times | “Automakers Brace for Impact of Trump Tariff Plan for Canada and Mexico”

Learn more about Jim Motavalli