Trump's EV Moves: Tax Credits Ending, Fines Gone - Winners and Losers

U.S. President Donald Trump’s unfriendly stance on electric vehicles (EVs) is set to reshape the auto industry. His “Big Beautiful Bill,” passed in July, will end the federal EV tax credits on Sept. 30.Until then, eligible buyers can still knock $7,500 off the sticker price—on top of other incentives— but once the deadline is here, the perk disappears. Additionally, the bill has scrapped the penalties for automakers who fail to meet Corporate Average Fuel Economy (CAFE) standards. Just a few years ago, under the Biden administration, automakers were doubling down on EVs. Tax breaks, supportive policies and stricter emissions rules pushed companies to speed up their e-mobility efforts.But things have changed now. Trump’s rollback of incentives and regulations, along with new tariffs on imported vehicles and parts, is changing the economics of EVs in the United States. The shift is forcing legacy automakers to rethink their electrification plans.Detroit’s Legacy Carmakers Welcome the ShiftFor traditional automakers like General Motors GM and Ford F, the policy change comes as a financial breather. Bloomberg recently reported that this rollback could unlock billions of dollars for Detroit carmakers to reinvest in gasoline-powered and hybrid vehicles.Ford CEO Jim Farley even called the policy shift a “multibillion-dollar opportunity” for its gas and hybrid business. GM CFO Paul Jacobson echoed the sentiment, saying the removal of fines will start saving the company money as early as 2026.The reason is simple— without fuel economy fines, Ford and General Motors no longer need to buy regulatory credits from EV-only players. GM has spent $3.5 billion on credits since 2022, while Ford has cut $1.5 billion in similar purchases this year. They can now redirect the money into profitable gas-powered trucks and SUVs.GM and F currently carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.GM and Ford Scale Back EV AmbitionsThis policy reset is showing up in production plans. GM recently announced it will temporarily cut one shift each for the GMC Hummer EV and Cadillac Escalade IQ between Sept. 2 and Oct. 6. While the Silverado EV and Sierra EV pickups remain in production, GM has delayed its second electric truck plant and Buick’s first EV by six months. Instead, the automaker revealed $4 billion in spending for mostly gasoline-powered vehicles—clear evidence it’s not betting everything on EVs anymore.Ford is making similar adjustments. The company cut its Rouge Electric Vehicle Center in Dearborn—where the F-150 Lightning is built—to a single shift. It also scrapped plans for an all-electric three-row SUV in Ontario. Instead, Ford is leaning into hybrids, especially in its best-selling truck lineup. Farley has said the Ford Blue division, which builds gas and hybrid vehicles, had been shouldering most of the compliance burden under stricter rules. With Trump’s rollback, that division stands to benefit the most. In fact, Ford is retooling its Oakville plant to make Super Duty F-Series pickups starting next year, reversing its earlier plan to build EVs there.While Detroit’s legacy automakers view the rollback as a relief, the story looks very different for pure play EV companies like Tesla TSLA, Lucid Group LCID and Rivian Automotive RIVN, which relied heavily on incentives and credits to fuel demand and profits.EV Pure Plays Lose a Safety NetTesla, Rivian and Lucid are losing a major source of revenues. That’s because Trump’s rollback not only ends consumer tax credits but also kills the market for regulatory credits.Under the old rules, automakers that fell short of fuel-economy targets had to either pay fines or buy credits from companies that exceeded the standards—mostly EV makers. Tesla, Rivian and Lucid were prime beneficiaries of this system. Now that the fines are gone, so is the need for credits. And the impact is beginning to show.Rivian said regulatory credits made up 6.5% of its total revenues in the first half of 2025, but it doesn’t expect any credit sales for the rest of the year. Last year, Rivian earned more than $400 million from these sales. Losing that cushion makes its path to profitability even steeper.Lucid is facing a similar squeeze. It is already battling demand and profitability challenges, so the loss of this income stream just adds to the hurdles.Tesla, meanwhile, is taking the biggest hit in absolute dollars. Since 2019, Tesla has generated over $10.6 billion from credit sales—profits that often made the difference during lean quarters. In the last reported quarter alone, Tesla booked $439 million from credits. While that sounds strong, it’s down nearly 50% from the $890 million it earned a year earlier. The decline has been steady, quarter after quarter, and Trump’s rollback threatens to accelerate the slide.Final ThoughtsGM and Ford, with their deep gas and hybrid portfolios, are among the winners from the EV policy changes. They would gain flexibility, save billions in compliance costs, and push forward with vehicles that still deliver strong margins.On the losing side are Rivian and Lucid, whose business models counted on credit revenues to partially offset losses from selling EVs. Without that extra income, their road to profitability looks longer and riskier. Tesla, too, faces margin pressure as one of its reliable profit levers disappears.Zacks Names #1 Semiconductor StockThis under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ford Motor Company (F): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Lucid Group, Inc. (LCID): Free Stock Analysis Report Rivian Automotive, Inc. (RIVN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks