Trump Signs Measure Overriding EV Mandate, a Blow to Musk and California

President Donald Trump has signed a measure that will override California’s electric vehicle mandate and prevent the state from compelling automakers to cut their greenhouse gas emissions at an accelerated rate. The move comes several weeks after the GOP Senate voted in favor of blocking California’s 2035 electric vehicle mandate and will deal a significant blow to the state’s electrification plans. Tesla, which is currently dealing with falling sales due to brand issues, will also be affected by President Trump’s recent announcement.

The controversial GOP president recently signed several congressional measures designed to rescind California emission standards that were designed to phase out internal combustion engine (ICE) vehicle sales and accelerate the state’s transition to battery electric vehicles (BEVs). As California is the largest automobile market in the U.S., and several other states have also adopted California’s emission standards, they would have forced most automakers to spend millions upon millions of dollars on electrifying their vehicle lineups.

This would have been an incredibly risky investment for most American automakers given the myriad of issues that are currently holding back EV adoption. California’s EV mandate would have required that automakers gradually reduce their vehicle emissions; 35% of new vehicle sales would have been electric by 2026, and the share of electric cars would increase to 68% by 2030 and finally reach 100% by 2035.

However, President Trump said that the Golden State’s emission standard would have limited customer choice and negatively impacted the local car industry. He argued that the Biden administration allowed ‘left-wing radicals’ in California to ‘control’ the American and global automobile industry’s future in a ‘horrible scheme’ that would have eradicated ICE cars, which he says most drivers prefer.

The comments were in line with President Trump’s previous views on electric cars and the previous administration’s massive investments in climate action. He spent his first days and weeks in the White House rolling back most of the Biden administration’s climate action policies, instructed states to stop constructing public charging infrastructure using federal funds, and now plans to eliminate federal tax incentives for EV purchases.

After his recent fallout with Tesla CEO Elon Musk, President Trump seems to be escalating his anti-electric vehicle agenda. The loss of federal tax incentives coupled with the loss of California’s electric vehicle mandate will undoubtedly be hard on Tesla, especially now that the Texas-based automaker is facing lots of brand blowback and diminishing sales.

Other American startups like Mullen Automotive Inc. (NASDAQ: MULN) will now have to rethink their market penetration strategies in light of the growing bottlenecks triggered by Trump’s stance on EVs and renewable energy.

NOTE TO INVESTORS: The latest news and updates relating to Mullen Automotive Inc. (NASDAQ: MULN) are available in the company’s newsroom at https://ibn.fm/MULN

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