As expected, the transition team for President-elect Donald Trump is now reportedly looking to slash support for electric vehicle (EV) and charging programs set up by the Biden administration, along with lodging global tariffs and pushing to ease regulations on fossil-fuel emissions.
The Trump transition team is now looking at plans to ease regulations on the fossil fuel industry and to cut many EV programs, including the $7,500 EV tax credit, along with lodging tariffs on battery material imports worldwide, according to a document seen by Reuters this week.
As part of efforts to bolster the domestic supply chain for battery materials, many of which are produced in China and are heavily subsidized in the U.S., the transition team has recommended imposing tariffs on all battery materials around the world, before negotiating individual exemptions with allies, as the document shows.
“When he takes office, President Trump will support the auto industry, allowing space for both gas-powered cars and electric vehicles,” said Karoline Leavitt, spokesperson for the Trump transition team, in a statement.
RELATED: U.S. Supreme Court to hear challenge on California emission rule waiver
Although Trump campaigned on promises to end the $7,500 federal EV credit and official plans to kill the subsidy were reported last month, the transition team has also called for rolling back the $7.5 billion plan passed under Biden to help aid the buildout of charging stations for EVs.
Instead, the team has said that it would shift this and other funding currently going toward making EVs more affordable toward national defense efforts, including the initiative to secure battery supplies without relying on China. The document notes that these efforts would focus on shifting money toward battery material production, as well as the “national defense supply chain and critical infrastructure.”
The document suggested that the team utilize Section 232 tariffs, which are intended to limit the import of any items related to potential national security threats. Biden recently increased tariffs on several imports related to charging technology and critical minerals for EV batteries, including graphite, “permanent magnets” used in EV motors and in military applications, and lithium-ion batteries, among others, though the tariffs were issued on economic grounds, rather than on those in national security.
The transition team is also looking to waive environmental reviews to accelerate “federally funded EV infrastructure projects,” such as those in battery production and recycling, charging deployment, and manufacturing of critical minerals. Other proposals detailed in the document include:
- Ditching federal requirements for electrifying government fleets, including Biden’s policy to mandate all federal purchases by zero-emission vehicles by the end of 2027
- Using the Export-Import Bank of the U.S. to provide financial support for U.S. batteries for EVs
- Utilizing tariffs as a “negotiating tool” to encourage other markets to consider U.S. auto exports including both gas cars and EVs
- Ending restrictions on exports of EV battery technology to countries deemed adversaries
- Ending programs for the Department of Defense attempting to buy or develop electric military vehicle options
How will ending the $7,500 EV tax credit affect Tesla? Musk calls it a benefit
While many have said that ditching the $7,500 tax credit and other policies intended to help spur on the adoption of EVs could hurt Tesla, CEO Elon Musk and others have argued that it may only benefit the company by harming other automakers even more. Wedbush analyst Dan Ives said last month that the change would only “enable Tesla to further fend off competition from Detroit,” given its already decisive advantage in EV scale.
In his latest statement regarding EV subsidies, made on X last month, Musk called for the U.S. to “end all government subsidies, including those for EVs, oil and gas.”
Musk also campaigned with Donald Trump during the election and created the political action committee (PAC), dubbed America PAC, to support his candidacy financially. He has since gained a position in what the team has called the Department of Government Efficiency, and he’s expected to play a major role in the upcoming administration.
In a report last week, it was said that the Trump transition team is also considering getting rid of a mandatory reporting measure for automated driving systems, as part of a larger effort to remove regulations and push self-driving vehicle development forward more quickly. An additional report from last month also suggests that Trump is already looking to create federal rules surrounding the rollout of autonomous vehicles, expected to accelerate the deployment of commercial robotaxis and other self-driving technologies.
What are your thoughts? Let me know at zach@teslarati.com, find me on X at @zacharyvisconti, or send us tips at tips@teslarati.com.
Analysts weigh in on Trump presidency’s effects to U.S. auto sector
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Tesla’s new Full Self-Driving pricing strategy will eliminate one recurring complaint that many owners have had in the past: FSD transfers.
In the past, if a Tesla owner purchased the Full Self-Driving suite outright, the company did not allow them to transfer the purchase to a new vehicle, essentially requiring them to buy it all over again, which could obviously get pretty pricey.
This was until Q3 2023, when Tesla allowed a one-time amnesty to transfer Full Self-Driving to a new vehicle, and then again last year.
Tesla is now allowing it to happen again ahead of the February 14th deadline.
The program has given people the opportunity to upgrade to new vehicles with newer Hardware and AI versions, especially those with Hardware 3 who wish to transfer to AI4, without feeling the drastic cost impact of having to buy the $8,000 suite outright on several occasions.
Now, that issue will never be presented again.
Last night, Tesla CEO Elon Musk announced on X that the Full Self-Driving suite would only be available in a subscription platform, which is the other purchase option it currently offers for FSD use, priced at just $99 per month.
Tesla is shifting FSD to a subscription-only model, confirms Elon Musk
Having it available in a subscription-only platform boasts several advantages, including the potential for a tiered system that would potentially offer less expensive options, a pay-per-mile platform, and even coupling the program with other benefits, like Supercharging and vehicle protection programs.
While none of that is confirmed and is purely speculative, the one thing that does appear to be a major advantage is that this will completely eliminate any questions about transferring the Full Self-Driving suite to a new vehicle. This has been a particular point of contention for owners, and it is now completely eliminated, as everyone, apart from those who have purchased the suite on their current vehicle.
Now, everyone will pay month-to-month, and it could make things much easier for those who want to try the suite, justifying it from a financial perspective.
The important thing to note is that Tesla would benefit from a higher take rate, as more drivers using it would result in more data, which would help the company reach its recently-revealed 10 billion-mile threshold to reach an Unsupervised level. It does not cost Tesla anything to run FSD, only to develop it. If it could slice the price significantly, more people would buy it, and more data would be made available.
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Tesla Model 3 and Model Y dominates U.S. EV market in 2025
The figures were detailed in Kelley Blue Book’s Q4 2025 U.S. Electric Vehicle Sales Report.
Tesla’s Model 3 and Model Y continued to overwhelmingly dominate the United States’ electric vehicle market in 2025. New sales data showed that Tesla’s two mass market cars maintained a commanding segment share, with the Model 3 posting year-to-date growth and the Model Y remaining resilient despite factory shutdowns tied to its refresh.
The figures were detailed in Kelley Blue Book’s Q4 2025 U.S. Electric Vehicle Sales Report.
Model 3 and Model Y are still dominant
According to the report, Tesla delivered an estimated 192,440 Model 3 sedans in the United States in 2025, representing a 1.3% year-to-date increase compared to 2024. The Model 3 alone accounted for 15.9% of all U.S. EV sales, making it one of the highest-volume electric vehicles in the country.
The Model Y was even more dominant. U.S. deliveries of the all-electric crossover reached 357,528 units in 2025, a 4.0% year-to-date decline from the prior year. It should be noted, however, that the drop came during a year that included production shutdowns at Tesla’s Fremont Factory and Gigafactory Texas as the company transitioned to the new Model Y. Even with those disruptions, the Model Y captured an overwhelming 39.5% share of the market, far surpassing any single competitor.
Combined, the Model 3 and Model Y represented more than half of all EVs sold in the United States during 2025, highlighting Tesla’s iron grip on the country’s mass-market EV segment.
Tesla’s challenges in 2025
Tesla’s sustained performance came amid a year of elevated public and political controversy surrounding Elon Musk, whose political activities in the first half of the year ended up fueling a narrative that the CEO’s actions are damaging the automaker’s consumer appeal. However, U.S. sales data suggest that demand for Tesla’s core vehicles has remained remarkably resilient.
Based on Kelley Blue Book’s Q4 2025 U.S. Electric Vehicle Sales Report, Tesla’s most expensive offerings such as the Tesla Cybertruck, Model S, and Model X, all saw steep declines in 2025. This suggests that mainstream EV buyers might have had a price issue with Tesla’s more expensive offerings, not an Elon Musk issue.
Ultimately, despite broader EV market softness, with total U.S. EV sales slipping about 2% year-to-date, Tesla still accounted for 58.9% of all EV deliveries in 2025, according to the report. This means that out of every ten EVs sold in the United States in 2025, more than half of them were Teslas.
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Tesla Model 3 and Model Y earn Euro NCAP Best in Class safety awards
“The company’s best-selling Model Y proved the gold standard for small SUVs,” Euro NCAP noted.
Tesla won dual categories in the Euro NCAP Best in Class awards, with the Model 3 being named the safest Large Family Car and the Model Y being recognized as the safest Small SUV.
The feat was highlighted by Tesla Europe & Middle East in a post on its official account on social media platform X.
Model 3 and Model Y lead their respective segments
As per a press release from the Euro NCAP, the organization’s Best in Class designation is based on a weighted assessment of four key areas: Adult Occupant, Child Occupant, Vulnerable Road User, and Safety Assist. Only vehicles that achieved a 5-star Euro NCAP rating and were evaluated with standard safety equipment are eligible for the award.
Euro NCAP noted that the updated Tesla Model 3 performed particularly well in Child Occupant protection, while its Safety Assist score reflected Tesla’s ongoing improvements to driver-assistance systems. The Model Y similarly stood out in Child Occupant protection and Safety Assist, reinforcing Tesla’s dual-category win.
“The company’s best-selling Model Y proved the gold standard for small SUVs,” Euro NCAP noted.
Euro NCAP leadership shares insights
Euro NCAP Secretary General Dr. Michiel van Ratingen said the organization’s Best in Class awards are designed to help consumers identify the safest vehicles over the past year.
Van Ratingen noted that 2025 was Euro NCAP’s busiest year to date, with more vehicles tested than ever before, amid a growing variety of electric cars and increasingly sophisticated safety systems. While the Mercedes-Benz CLA ultimately earned the title of Best Performer of 2025, he emphasized that Tesla finished only fractionally behind in the overall rankings.
“It was a close-run competition,” van Ratingen said. “Tesla was only fractionally behind, and new entrants like firefly and Leapmotor show how global competition continues to grow, which can only be a good thing for consumers who value safety as much as style, practicality, driving performance, and running costs from their next car.”
Tesla Full Self-Driving pricing strategy eliminates one recurring complaint
Tesla Model 3 and Model Y dominates U.S. EV market in 2025
