On December 16, 2025, the American automotive and environmental landscape shifted dramatically as President Donald Trump announced the rollback of vehicle fuel efficiency regulations, calling it the end of the "green new scam." The move, which follows a series of sweeping changes since Trump’s return to office in January, signals a decisive pivot away from federal support for electric vehicles (EVs) and green transportation policies championed by the previous administration.
The Trump administration’s actions have been swift and far-reaching. Among the most significant changes: the repeal of incentives for EVs, including the revocation of a Biden-era executive order that required half of all new cars sold in the U.S. by 2030 to be electric. Billions in funding for charging infrastructure have been frozen, and the $7,500 federal tax credit on EV purchases—a major driver of consumer adoption—has been eliminated. Fuel economy requirements have also been slashed, dropping from an ambitious 50 miles per gallon for 2022-2031 models to a more modest 35 miles per gallon.
These policy reversals have reverberated across the auto industry. Ford Motor Co., one of America’s most iconic automakers, announced on December 15 that it will take a staggering $19.5 billion accounting loss over the next several years as it scales back its EV strategy. The company’s plans include ending production of the all-electric F-150 Lightning in 2025, canceling several planned EV models such as a next-generation electric pickup and electric commercial vans, and shifting its focus toward hybrids, extended-range electric vehicles, and gasoline-powered models. The company now aims for these vehicles to make up about half of its global sales by 2030.
Ford’s decision is not merely a response to internal business challenges. According to reporting from outlets like Bloomberg and The Wall Street Journal, the automaker’s retreat from battery-powered vehicles is a direct reaction to the Trump administration’s policy changes and a reflection of softer consumer demand. The expiration of the federal EV tax credit and looser enforcement of emissions standards have made the economics of EV production less attractive, especially as Ford’s EV division has already lost more than $12 billion since 2023 due to rising costs and slowing sales.
Ford’s $19.5 billion charge includes $8.5 billion tied to canceled EV programs, $6 billion to ending a battery joint venture with South Korea’s SK On, and about $5 billion in program-related expenses. Most of these losses will be recorded in 2025 and 2026, with $5.5 billion in cash effects stretching into 2027. Ford executives have described the move as a "customer-driven shift" toward higher-return products, with one executive stating, "Rather than spending billions more on large EVs that now have no path to profitability, we are allocating that money into higher-returning areas."
Media coverage has reflected the polarized views on this shift. Outlets like Newsmax and the New York Post underscored the enormous sums Ford has invested in EVs and the growing skepticism within the auto industry about the profitability of electric vehicles. Meanwhile, more centrist and left-leaning publications highlighted Ford’s rationale and the potential positives of the new strategy, with Bloomberg noting that Trump’s policy changes are likely to exacerbate the challenges automakers face in making EVs profitable. The Wall Street Journal described Ford’s move as "a fresh sign" that gas-powered cars will remain a fixture on American roads for years to come.
The rollback has drawn sharp criticism from environmental advocates and Democratic leaders. California Governor Gavin Newsom, whose state leads the nation in renewable energy and EV adoption, accused Trump of "handing his Big Oil donors exactly what they want: weaker protections for consumers and bigger profits for polluters." According to the National Highway Traffic Safety Administration (NHTSA), the stricter fuel efficiency standards established under the previous administration would have reduced national fuel consumption by 70 billion gallons annually. Newsom and others argue that the rollback will not only increase pollution but also cost consumers at the pump.
Steven Higashide, Director of the Clean Transportation Program at the Union of Concerned Scientists, emphasized the economic and environmental stakes: "US vehicle pollution and reliance on oil have dropped and drivers can save money by choosing more efficient vehicles." He noted that fifty years of increasing fuel efficiency standards have shielded drivers from oil market shocks, improved air quality, and saved Americans over $5 trillion. The weakening of these standards, he warned, threatens to reverse decades of progress.
Internationally, the U.S. risks falling further behind in the global race toward electrification. Ben Scott, head of Energy Demand at Carbon Tracker, a UK-based climate think tank, called the rollback "a clear win" for the U.S. oil industry but "an even bigger victory for China, as it pushes the US further behind in the EV transition." In 2024, 20% of cars sold worldwide were electric—a 25% jump from the previous year. Of the 17 million EVs sold globally, 11 million were purchased in China, where nearly half of all domestic car sales are electric, compared to just 10% in the U.S. China’s dominance is fueled by massive state incentives that have driven down the cost of low-emission vehicles, making them cheaper than most petrol models at home.
Meanwhile, the environmental stakes remain enormous. Transportation accounts for 29% of U.S. carbon emissions, the largest share by sector. The previous fuel economy standards would have prevented more than 710 million metric tons of climate pollution annually. Electric cars, which produce only a third of the emissions of their petrol counterparts, were driving the decarbonization of America’s roads as EV sales broke records in early 2025. Now, that momentum appears to be stalling.
Some critics of electrification have raised concerns about the energy and resources required for EV batteries. But Ellen Kennedy, a clean transportation expert at the Rocky Mountain Institute, points out that battery recycling technology is rapidly advancing. "More than 90% of lithium and 95% of nickel and cobalt can be recycled from batteries," she said, adding that "battery mineral recycling and recovery is continuing to improve, whereas fossil fuels are limited in supply and can only be used once." In 2024, global on-road transportation consumed 2,150 million tons of oil, while just 125 million tons of minerals supported battery reuse and recycling—a stark contrast that highlights the potential for a circular economy in EV batteries.
As the U.S. pivots back toward gasoline-powered vehicles and away from an electrified future, the implications for the climate, the economy, and America's place in the global auto industry are profound. While the debate over the right path forward continues, one thing is clear: the road ahead for American transportation is more uncertain than ever.