US President Donald Trump’s administration announced on Wednesday that it would rescind a rule rewarding electric vehicle production – eliminating the so-called “fuel content factor” – the latest in a series of actions that roll back federal support for EVs that analysts say could leave the US further behind in a global race increasingly shifting in China’s favour.
The move comes as the US struggles to compete with China’s rapid growth in the EV sector globally, marking another setback for America’s industry, which has also seen tax incentives slashed and emissions rules eased since Trump returned to office.
Some analysts argue that rolling back regulations, such as fuel economy standards, pushes the US further towards petrol cars, discourages EV innovation and gives China a competitive edge. Others are concerned about the uneven playing field during a transitional period for the industry.
The rule rescinded on Wednesday allowed manufacturers to count electric vehicles as having artificially high fuel-economy values when calculating fleetwide averages under Corporate Average Fuel Economy (CAFE) standards. Known as the “fuel content factor”, it was designed to incentivise carmakers to produce EVs by effectively crediting them with greater energy savings.
CAFE standards aim to “reduce energy consumption by increasing the fuel economy of cars and light trucks”, according to the US Department of Transportation.
In February, the Environmental Protection Agency rescinded the “endangerment finding”, which forms the basis of climate regulations in the US, and repealed tailpipe pollution standards.
“American families will suffer long-term harms so that giant auto and oil companies can pocket short-term profits,” said Dan Becker, director of the Centre for Biological Diversity’s Safe Climate Transport Campaign, in a statement on the company’s website.
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