Trump administration touts policies to lower car prices

Top Trump administration officials visited the Detroit Auto Show to promote efforts aimed at reducing car prices through the rollback of electric vehicle regulations. The moves, part of a broader de-emphasis on EVs, seek to align policies with consumer demand for traditional vehicles amid rising affordability concerns. Officials emphasized that these changes would not target EVs but rather end penalties on combustion engines.

On Saturday, Transportation Secretary Sean Duffy, Environmental Protection Agency head Lee Zeldin, and U.S. Trade Representative Jamieson Greer toured the annual Detroit Auto Show. This visit capped a two-day Midwestern trip that included stops at a Ford truck factory and a Stellantis Jeep plant in Ohio on Friday.

The administration has moved aggressively to undo electric vehicle rules established under former President Joe Biden. Last year, President Donald Trump signed legislation eliminating the $7,500 EV tax credit, rescinding California's EV mandates, and canceling penalties for automakers failing to meet fuel efficiency standards. In December, the U.S. Department of Transportation proposed rolling back Biden-era fuel efficiency standards, which had encouraged more EV production. The EPA is expected to soon finalize a rule eliminating vehicle tailpipe emissions requirements.

Duffy stated that these policies "will bring car prices down and allow car companies to offer products that Americans want to buy." He clarified, "this is not a war on EVs at all … We shouldn’t use government policy to encourage EV purchases all the while penalizing combustion engines." Zeldin echoed this, saying the government "should not be forcing, requiring, mandating that the market go in a direction other than what the American consumer is demanding."

These efforts come as Trump faces economic challenges a year into his term, with midterm elections approaching in November. Average new car prices reached a record $50,326 in December, according to Cox Automotive, driven by demand for trucks and SUVs and fewer entry-level options. Automakers also contend with Trump's tariffs on imported vehicles and parts.

Despite these changes, U.S. vehicle sales increased 2.4% in 2025 to 16.2 million units. The USDOT estimates its proposal would cut average upfront vehicle costs by $930 but raise fuel consumption by up to 100 billion gallons through 2050, adding $185 billion in fuel costs for Americans.

Democrats argue that tariffs and the removal of EV incentives will hurt consumers. Greer countered that car prices are declining and that tariff impacts on supply chains are not reaching buyers. Kathy Harris of the Natural Resources Defense Council criticized the approach, warning, "The oil industry will rake in billions more from cash-strapped Americans who can’t afford to spend more to fuel up their car or truck."

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Illustration of empty Tesla dealership lot with unsold Model 3 and Y cars, signs noting end of $7,500 EV tax credit and 23% sales drop.
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Tesla US Sales Plunge After EV Tax Credit Ends, Despite Cheaper Models

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Tesla's US sales dropped 23% year-over-year to 39,800 vehicles in November 2025—the lowest since January 2022—following the $7,500 federal EV tax credit's expiration on September 30. New Standard variants of Model 3 and Y failed to stem the tide amid a broader 41% EV market decline, though Tesla's share rose to 56.7%.

Electric vehicle sales in the US dropped to just over 70,000 units in November, more than 40% lower than the previous year and 5% below October. While average prices edged down slightly, incentives rose significantly, signaling a market in transition. Tesla faced particular pressure with declining sales across its models.

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One year into his second term, President Donald Trump aggressively dismantled environmental protections and boosted fossil fuels, slowing U.S. clean energy momentum. However, many actions rely on reversible executive orders amid legal pushback and market-driven renewable growth, limiting their long-term effects.

Tesla's Cybertruck sales plummeted 48% in 2025 to 20,237 units from 38,965 in 2024—the steepest decline among U.S. electric vehicles—per Cox Automotive and Kelley Blue Book data. The downturn, far below initial projections of 250,000 annual units, stemmed from multiple recalls, the end of $7,500 federal tax credits, affordability issues, design polarization, and Elon Musk-linked backlash, despite international expansion and a leading EV market share.

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Following the December 2025 decree imposing 5-50% tariffs on non-FTA imports, Mexico's measures particularly target the automotive sector, hiking duties on light vehicles to 50% and parts up to 50%. While aiming to protect national industry and generate over 70 billion pesos in revenue, the policy draws criticism for slowing Chinese EV tech adoption, though brands remain bullish on Mexico's market thanks to local plants.

President Trump delivered a speech at the Detroit Economic Club, aiming to refocus on the American economy but largely deviating into personal grievances. He touted economic achievements while blaming former President Joe Biden for inflation and attacking Federal Reserve Chairman Jerome Powell. The event marks his first domestic trip amid recent international headlines.

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Building on November's EV sales slump where Tesla gained market share despite industry declines (see prior coverage), Tesla topped US automakers with a $1.61 trillion market value as 2025 ended, amid tariffs, slowing EV adoption, and policy shifts. GM, Ford, Rivian, and Lucid followed with mixed results.

 

 

 

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