Former President Donald Trump’s shifting environmental and automotive policies are projected to escalate vehicle ownership costs for American consumers and undermine the U.S. auto industry’s global competitiveness.
The average price for a new car in the United States has surpassed $50,000 for the first time. Simultaneously, fuel costs remain the largest energy expense for American households, averaging $2,930 annually.
This financial burden is exacerbated by what analysts term “Regulation Whiplash” within the U.S. automotive industry. Automakers face immense uncertainty from constantly changing vehicle efficiency and pollution standards.
These regulatory shifts have cycled from strict under former President Barack Obama, to relaxed under Trump, then strict again under President Joe Biden. Trump is now reportedly poised to relax these policies once more.
Such frequent changes, occurring every two to three years, hinder car manufacturers from planning and investing in new models. These developments require significant time and capital.
The resulting disruption and adaptation costs are ultimately passed on to consumers. Relaxed fuel efficiency and emissions standards also remove incentives for manufacturers to produce more economical vehicles.
Analysts predict that repealing these standards could cost U.S. households an additional $310 billion in fuel expenses by 2050. This means drivers will pay more at the pump.
Globally, the U.S. auto industry is struggling. Key markets like Europe are phasing out combustion engine vehicles, while China leads in producing popular, affordable electric vehicles.
Trump’s policies have removed incentives and reduced support for domestic battery production. This strategy risks further eroding the United States’ ability to compete in the global automotive market.
The former president previously claimed that environmental deregulation would lower the cost of producing electric vehicles. However, while initial EV production costs can be high, they offer significant long-term savings for drivers.