This is an extended update to a SNIPS NEWS story from last year.
The electric vehicle industry faces a watershed moment as President Trump’s “Unleashing American Energy” executive order marks the most dramatic shift in federal EV policy since the sector’s expansion began. While the order formally revokes Biden’s electric vehicle mandate, industry experts note that unwinding existing programs may prove more complex than anticipated.
The impact is already visible: EV sales growth is projected to slow to 16% in 2025, though manufacturers like Rivian continue to meet production targets. The industry now faces dual challenges: adapting to reduced federal support while maintaining the momentum built over the past four years.
“If there’s one lesson to take from a deep read of the executive orders, it’s that all of these changes will take time and some may be blocked,” wrote Sean Tucker for Kelley Blue Book. “Agencies will likely change some of the policies Trump has instructed them to change. But that is a slow process with several steps.”
The auto industry’s response has been measured. Through the Alliance for Automotive Innovation, manufacturers have emphasized the need for regulatory stability while acknowledging market realities. “There’s a mismatch between current EV market dynamics and the emissions and EV sales targets called for in recent regulations,” said John Bozzella, the alliance’s president and CEO.
For individual automakers, the response has been similarly measured. Stellantis said in a statement it is “well positioned to adapt to the policy changes enacted by the new Administration” and that it looks forward to working with the president. Ford had no comment on the changes, according to AP News, but even before they election, they began to pivot towards hybrid models.
For states like Illinois and California that have built significant EV manufacturing capacity, the federal policy reversal adds urgency to their efforts to protect clean vehicle initiatives. Sam Abuelsamid, vice president of market research at Telemetry Insights, warns that scaling back EV production could have unintended consequences on other states too.
“If these plants are not being utilized, and if they can’t sell the EVs, the plants, most of which are in Republican districts — those jobs are going to disappear,” Abuelsamid said. “It’s going to hurt jobs, lead to uncertainty and make the U.S. auto industry less competitive globally.”
Despite policy headwinds, the EV sector showed resilience through 2024. Americans purchased 1.3 million electric vehicles last year, with sales surging more than 15% in the fourth quarter. This growth, coupled with significant manufacturing investments, has created deep roots in state economies that may prove difficult to dislodge.
Illinois exemplifies this economic entrenchment. The state’s ambitious plan to put 1 million electric vehicles on the road by 2030 has attracted major industry players, creating a robust ecosystem of manufacturers and suppliers. Illinois has also increased its tax credit to 75% for automakers that retain employees during their transition to EV production. Meanwhile, California continues to push forward with its Zero-Emission Vehicle program, mandating all new passenger vehicles sold in the state be zero-emission by 2035, though this faces potential legal challenges from the incoming administration as it rests on an EPA waiver issued during the Biden administration.
Grants and Loans Frozen
The Department of Energy’s conditional loan commitments, including the $6.6 billion to Rivian and $7.54 billion to Stellantis, have been frozen pending review, creating uncertainty for manufacturers and state economies alike. This pause affects not just the automakers but also their extensive supply chains and the communities that depend on these investments.
The situation remains fluid as states and manufacturers navigate this shifting landscape. For companies like Rivian and Stellantis that have secured federal funding, the immediate focus is on protecting those investments while adapting to what industry analysts are calling “a new normal” for American automakers.
After automaker Rivian paused construction of a new factory in Georgia, the Biden Administration stepped in to offer a $6.6 billion federal loan in late 2024. This contingent commitment from the federal government, along with others hurriedly pushed out the door in the waning months of the Biden administration, are now a target for elimination by the incoming Trump administration.
The response from state leaders has been swift. In California, Governor Gavin Newsom pledged to restart the state’s zero-emission vehicle rebate program if federal tax credits are eliminated, while approving a $1.4 billion investment plan for EV charging infrastructure. Meanwhile, at a recent press conference, Illinois Governor JB Pritzker addressed the challenges facing American manufacturers, pledging to protect the funding secured by EV and battery manufacturers under programs funded through President Biden’s signature Inflation Reduction Act and Bipartisan Infrastructure Law.
“We’re fighting like heck to make sure [the loan] is secured for the future,” Pritzker said, raising concerns about potential political interference. While Stellantis is receiving $7.54 billion to build two electric vehicle battery plants in Indiana, he noted this funding appears more secure than Rivian’s, which only recently crossed the finish line. The newly created Department of Government Efficiency (DOGE), to be led by Elon Musk as a senior advisor, has specifically targeted newer EV sector subsidies for review.
Musk’s former partner in leading DOGE, Vivek Ramaswamy, called out Rivian in particular late last year as the Biden administration began announcing more clean energy and EV loans through the Department of Energy. Ramaswamy noted Rivian is “high on the list of items” that he wanted to claw back once DOGE begins operations.
“Last-minute actions that are taking place in the lame duck merit particularly special scrutiny,” Ramaswamy told CNN in December.
Demand for Duct
Regardless of timing, the sheet metal industry has experienced an increase in demand for low leakage sheet metal ductwork, as well as insulated metal panels, from EV manufacturing loans.
Gov. Pritzker called the loans essential for building the infrastructure of the future. The state of Illinois has strongly backed Rivian and Stellantis, offering an $827 million incentive package to expand the former’s Normal, Illinois, plant.
“For the last four years, we have been trying to figure out how to be better partners to people who are doing big things again in the United States,” Pritzker said. “You’re seeing a tripling of new manufacturing facilities getting built in this country … we’re at $340 billion of investment this year for clean energy technology deployment.”
Rivian CEO RJ Scaringe defended the public-private partnership at DOE’s Industrial Heat Shot Summit in Oct. 2023., noting it helps American EV manufacturers compete globally.
“Building a car company … these are businesses that take a tremendous amount of capital,” Scaringe explained. “If you want to start a car company and you’re being intellectually honest, you need many, many billions of dollars.”
Rivian’s registrations in California have jumped over 76% in recent months, with the R1S becoming one of the most popular SUVs in the state. With over 100,000 vehicles now on American roads, Rivian is planning even more models.
The Department of Energy loan package will help fund increased production capacity at their Georgia facility.
“There’s this feeling that it’s always better to innovate here and scale up in China … But both of you have decided that you’re going to do it here,” Pritzker said in reference to Rivian and Stellantis.
Addressing supply chain concerns, Scaringe detailed the complexity of automotive manufacturing, noting their R1S SUV contains “about 3,000 purchased items” and “well over 30,000 individual parts.” This highlights the strategic importance of developing domestic manufacturing capability as the U.S. works to reduce dependence on foreign suppliers, particularly for critical minerals and batteries from China.
In 2023, Rivian secured a $5.8 billion software licensing deal with Volkswagen Group, which Scaringe cited as validation of American technological leadership.
“To see a very long standing, very large, giant automotive group decide to move their software architecture, their technology stack, to something that we developed here, of course, in the U.S., it was really exciting,” he said.
Rob Hanson, CEO of Monolith Materials, joined Scaringe at the press conference to advocate for continued government support of clean energy innovation. His company is now struggling to meet production targets to support EV expansion, jeopardizing a promised $1 billion loan from the federal government. The Trump administration will have latitude in its ability to react to production delays and underperformance by pulling funding on these load bearing developments – whereas the Biden-Harris administration likely would have been more lenient.
“I think harnessing the American innovation and entrepreneurship to really push forward, but having the right government, state, local, federal, that’s accelerating and supporting those company’s technologies, are ultimately in the national interest,” Hanson concluded.
With states now stepping into the federal policy void, the answer may lie in the uniquely American tradition of state-level innovation. This proves that industrial transformation rarely follows a straight line for manufacturers, consumers – and contractors – alike.