On Tuesday, as 170 million people from Dallas to Boston suffered under heat alerts, the Environmental Protection Agency released its long-promised proposal to revoke, once and for all, a scientific finding it has used to fight climate change. More specifically, the plan is to rescind the 2009 “endangerment finding” that undergirds that agency’s ability to regulate planet-heating greenhouse gas emissions, and eliminate all remaining limits on tailpipe emissions from motor vehicles and engines. The transportation sector, it should be pointed out, is the single largest contributor to greenhouse emissions in the United States; nearly 60 percent of the sector’s emissions come from personal vehicles. Lee Zeldin, the EPA administrator, announced the proposal from an Indiana car dealership. If enacted, it will leave drivers and automakers free to pollute as much as they like, Zeldin crowed, and will thereby reinstate “consumer choice” and give Americans “the ability to purchase a safe and affordable car for their family while decreasing the cost of living on all products that trucks deliver.”
None of that is true except the part about people and companies being free to pollute as much as they want. The EPA’s own website still states that Biden-era regulations were on track to nearly double the fuel efficiency of light-duty cars and trucks, meaning that existing regulations would help drivers pay less to travel farther. These same regulations were projected to save the average driver in the U.S. some $6,000 in fuel and maintenance costs over the life of a new vehicle. But Zeldin’s extraordinary effort to deregulate—a move that is bad for the planet, consumers, and public health—could end up dealing a serious blow to generally pro-deregulation automakers, too, by not forcing them to make vehicles that will compete globally.
The Trump administration has now taken a chainsaw to just about every subsidy and regulation that might have forced U.S. automakers to get with the times. Republicans’ One Big Beautiful Bill Act slashed subsidies for electric vehicles and nixed fines for automakers that fail to meet federal fuel efficiency standards. Those are administered by the Department of Transportation, which is currently reviewing them for possible overhaul. Although U.S. automakers have long chafed at federal mandates to clean up their cars, they don’t love rules that change every four years, either. As China continues to churn out cheaper, flashier models for customers at home and abroad, the subsidies and regulations now being demolished by the Trump administration might have pushed them to keep pace with competitors making their big, expensive, gas-guzzling models less appealing to buyers worldwide.
Among U.S. automakers biggest worries, though, are tariffs. The White House’s recently announced trade deals with Japan and the European Union subject cars imported from those places to lower tariffs (just 15 percent) than those imported from Canada and Mexico, including those shipped by U.S. companies that make a sizable percentage of their vehicles there. Canadian and Mexican imports are currently charged a 25 percent entry fee that’s set to rise on Friday, to 35 percent for Canada and 30 percent for Mexico. Cars built here also now have to factor in a 25 percent fee on imported parts—save for those that comply with the terms of the US-Mexico-Canada trade agreement—plus a 50 percent tariff on imported steel and aluminum. An additional 50 percent levy on copper is set to be implemented on Friday, as well.
The blow comes to an industry already facing serious headwinds. Ford, GM and Stellantis—the European company that owns Jeep, Chrysler and several other legacy US brands—were already struggling to adjust to a global auto market whose center of gravity has shifted toward China. Just this week, Stellantis announced that its revenues for the first half of 2025 were down 13 percent compared to the same period last year. GM’s second-quarter earnings took a $1.1 billion hit; the company projects that it could lose up to $5 billion from tariffs this year.
Those companies’ aggressive lobbying to weaken and dismantle greenhouse gas regulations in the name of maintaining business as usual could soon come back to bite them. As U.S. automakers continue to specialize in large, pricey and mostly gas-powered trucks and SUVs, Chinese firms like BYD have exploded production and sales of affordable, high-tech EVs, hybrids and gas-powered vehicles both in that country and in foreign markets like South America, Europe, and East Asia. Once marginal players, Chinese automakers went from exporting 1 million cars in 2020 to nearly 6 million in 2024; its production capacity is currently expanding by about 4 million units per year. Goldman Sachs projected last December that the market for global EV sales could soar to 73 million units by 2040, from just 2 million in 2020 to half of the entire global market in 2035. China currently makes 76 percent of EVs sold worldwide. With the White House apparently hellbent on shrinking already modest domestic demand for those vehicles, Detroit automakers seem poised to double down on making cars that less and less of the world wants.
Some of the auto industry’s top brass are already waxing apocalyptic about their prospects. Ford CEO Jim Farley—whose company on Thursday announced that it’s taken out a $3 billion line of credit to cope with economic uncertainty—recently fretted that the “quality” of Chinese vehicles is “far superior to what I see in the West,” he told a crowd at the Aspen Ideas Festival. “We are in a global competition with China, and it’s not just EVs,” he added. “And if we lose this, we do not have a future Ford.”
Boasting about his plans on Thursday, Zeldin said that the EPA is working “to end 16 years of uncertainty for automakers and American consumers.” In reality, Zeldin and the rest of the Trump administration could be saddling U.S. automakers with the most uncertain conditions they’ve ever faced.