California is an American state where electric cars are more than well established. But this engine is not part of the plans of the future Trump administration. The president-elect plans to eliminate purchasing subsidies; California intends to maintain them at all costs.
California wants to maintain subsidies for electric cars
California, often seen as a vanguard model in terms of environmental policies, is entering into a first standoff with the Trump administration. Thus, the president-elect is considering abolishing the federal tax credit for electric cars. But for his part, Democratic Governor Gavin Newsom stands in direct opposition. With 30% of national sales of electric vehicles concentrated in its territory and more than 2 million models already on its roads, California plays a central role in the energy transition of the United States. This battle is not only economic, but also symbolic.
Introduced under the Biden administration, This federal tax credit provides assistance of up to $7,500 for the purchase of new electric vehicles and $4,500 for used models. This measure aims to democratize access to non-polluting technologies and support the climate objectives of the United States. However, this policy is now threatened by the arrival of the Trump administration. Indeed, the entourage of the elected president plans to repeal it, arguing for a rationalization of public spending.
Tesla pushes for this ban
The majority of car manufacturers and consumers oppose this removal. However, the unexpected support of Elon Musk, CEO of Tesla, fuels the debates. The latter declared in July that this measure could benefit his company in the long term, by reducing the dependence of competitors like Ford and General Motors on this aid. Furthermore, Tesla, some components of which are manufactured in China, does not fully benefit from current credit.
Gavin Newsom promises to revive a similar California aid program to offset a possible federal cut. This program had already made it possible to subsidize more than 594,000 clean vehicles until 2023. California’s commitment goes well beyond simply defending subsidies. Indeed, the State aims to ban sales of new gasoline cars by 2035.
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