During a speech at the Detroit Economic Club on Tuesday, former President Donald Trump expressed strong opposition to the electric vehicle (EV) regulatory framework established under President Joe Biden. Central to his critique were the Corporate Average Fuel Economy (CAFE) standards, which Trump described as "ridiculous" and indicative of an "insane EV mandate."
Trump recalled his administration's efforts to nullify these regulations, asserting, "I terminated the insane EV mandate and ended the war on internal combustion engines." He further claimed that his actions "permanently stopped Joe Biden's ridiculous CAFE standards." These statements underscore his view that the prior standards excessively constrained the automotive sector.
According to Trump, the CAFE rules imposed significant challenges on the production of affordable vehicles. He contended that the standards represented environmental norms that are "impossible to meet," making vehicle manufacturing economically unfeasible. This perspective suggests that regulatory measures aimed at reducing emissions and promoting electric vehicles may have unintended consequences for automotive affordability.
Trump's administration took concrete steps against these standards towards the end of last year by officially rolling back the CAFE regulations across the United States. The stated objectives of this rollback included improving vehicle affordability and ensuring safety within the auto industry.
This regulatory shift has potential implications for major legacy automakers such as General Motors Co., Ford Motor Co., and Stellantis NV. Notably, General Motors and Ford recently announced reductions in their electric vehicle initiatives, moves that could be influenced by the changed regulatory environment. These developments demonstrate the tangible effects of federal policy shifts on corporate strategies within the automotive sector.
Support for the rollback also came from government officials including Transport Secretary Sean Duffy and Senator Ted Cruz of Texas. Duffy criticized the previous administration's policies, indicating that under Biden's tenure, a "backdoor EV mandate" contributed to inflation in vehicle prices. These comments emphasize perceived economic impacts of the earlier EV-focused standards on consumers and manufacturers alike.
Overall, the discussions around CAFE standards and EV mandates remain a contentious topic, reflecting broader debates about environmental regulation, industrial policy, and market dynamics within the automotive industry. The interplay between regulatory frameworks and corporate adjustments continues to shape the landscape of vehicle manufacturing in the United States.