by In 2024, Americans actively purchased fully electric cars, pickups, and SUVs, and tax credits of up to $7500 for new EVs were one of the main reasons for such demand. However, judging by the words of an influential Republican, these incentives may soon disappear.
“I think it’s more likely that we will cancel them than keep them,” House Speaker Mike Johnson stated in an interview with Bloomberg. “But we’ll see how it goes.”
The new administration does not hide its negative stance on these incentives, which were introduced under Barack Obama and later modified under Joe Biden. Some countries, including the UK and Germany, have already abandoned subsidies, believing that the electric vehicle market is now strong enough to develop without government support.
Canceling the incentives would align with Trump’s policy of promoting fossil fuels and dismantling the environmental initiatives of previous years. Furthermore, it would help Republicans save funds, although the real impact on the budget would be minimal—only $2 billion was spent on EV subsidies in the first 10 months of last year.
However, for automakers and buyers, the cancellation of incentives could have serious consequences. The production of electric cars is currently more expensive than that of conventional cars, and tax credits help to equalize prices. The loss of these incentives could further slow down the already weaker demand for electric vehicles in 2024, despite the billions invested by auto giants in the development of new models and factories.
These factors could become an argument in favor of preserving the incentives, as some Republicans would not support a decision that threatens job losses in their states. Some congressmen have already spoken out in favor of preserving certain “green” initiatives.
