Ford, GM, and Stellantis Disbursed Billions to Tesla and Rivian Before Trump Halted It | Carscoops
Emissions rollback alters EV market dynamics, favoring gas models while jeopardizing profits of EV manufacturers
24 hours ago
by Stephen Rivers
Ford, GM, and Stellantis stand to save billions due to Trump's emissions rollback. In contrast, Tesla could experience a loss exceeding $1 billion each year from credit revenue. The EPA’s commitment to safeguarding health and the environment is at odds with its current policies.
The automotive landscape is always evolving, but 2025 has been particularly unique as Donald Trump’s policies have transformed the operations of automakers. The cessation of federal tax credits for electric vehicles is a significant shift on its own. Coupled with the elimination of penalties for failing to meet fuel economy targets set by CAFE regulations, this has created a new set of rules for the industry.
The immediate beneficiaries are brands that focus on combustion engines, allowing them to concentrate on selling trucks and SUVs without financial repercussions. Conversely, Tesla, Rivian, and other EV-centric companies risk losing billions—not due to a fall in demand for their vehicles, but because a vital revenue source has been removed. Central to these developments is an Environmental Protection Agency seemingly acting contrary to its stated mission.
Cash Flow Shift
Since 2022, GM has reportedly invested around $3.5 billion in purchasing regulatory credits, according to Bloomberg. Ford and Stellantis have also spent substantial amounts. This cash flow has benefited companies like Tesla and Rivian, who had an abundance of credits to sell due to their zero-emission vehicles. With the elimination of EV tax credits and CAFE penalties for violations, Ford, GM, and Stellantis can redirect the funds they would have used for credits back into their own resources.
Ford CEO Jim Farley indicated that this policy change may present a “multibillion-dollar opportunity,” mentioning that the company is reconfiguring its Oakville, Ontario, plant to manufacture Super Duty pickups instead of electric vehicles.
GM is also scaling back its EV production, choosing to remodel factories for gasoline-powered models. Stellantis, on the other hand, has even decided to revive the fuel-guzzling Hemi V8 engine, which many believed had no place in the era of electrification. With these shifts, some EV brands might now face significant challenges.
Challenges for EV Startups
The discontinuation of tax credits not only makes EV purchases less appealing for many consumers but also requires brands that previously benefited from selling these credits to adapt to the new environment. Smaller manufacturers, in particular, may find themselves in dire straits. For instance, Slate’s trucklet seems nearly irrelevant with a starting price around $30,000, as the EV tax credit was crucial for its viability.
Even major players like Tesla and Rivian have relied on the significant profits gained from selling regulatory credits. However, such revenue may not return soon because the EPA appears willing to comply with the Trump Administration’s directives.
A Mission Overlooked
The EPA’s stated mission is to “protect human health and the environment.” Regardless of opinions on them, electric vehicles generally outperforms combustion vehicles in this regard. The EPA even maintains a webpage dedicated to dispelling common myths about EVs.
Claims such as “EVs are worse for the climate than gas cars,” “EVs are unreliable,” and “EVs will collapse the power grid” are addressed. Moreover, studies, including those by J.D. Power, show that when all costs are factored in, EVs are often cheaper to purchase, maintain, and own over time compared to gasoline vehicles.
No one argues that individuals should be mandated to choose a specific type of vehicle. Consumer choice is important. However, the government should endorse policies that promote human health and environmental welfare, which is precisely what the EPA purports to do.
By endorsing Trump’s rollback of stringent fuel economy standards and regulations, the agency contradicts its own mission statement. It is facilitating the production of more polluting vehicles, increasing fuel consumption, and negating billions in overall consumer savings. If the EPA fails to uphold its own objectives, it raises the question of who will.
Credit: Ford / GM / Slate / EPA
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