The automotive industry was one of many sectors within the U.S. economy holding its breath ahead of the presidential election. Under current government regulations, automakers will have to meet strict fuel efficiency and emissions standards that require aggressive growth in electric vehicle sales, moving toward 2030. But will those requirements change now that the election is over?

The Biden administration’s existing standards appear unrealistic based on current and near-term EV demand, putting automakers at financial risk as they attempt to navigate their product plans between government requirements and consumer preference. The cost of producing electric vehicles is substantially higher compared to traditional gasoline and hybrid models, which reduces or even eliminates their profit and further complicates the path forward.

These factors are already impacting multiple automakers’ financial security, as reflected in recent statements by Volkswagen Group and Stellantis.

The Trump-Vance win will create a shift away from the electric vehicle mandates, though the degree of pullback is unknown. Given the level of resources both domestic and foreign automakers have already invested in EV production, and the multi-year timeline required to change product plans, a substantial reduction in EV incentives and sales will still prove costly for the industry.

The uncertainty surrounding political shifts has long been one of the most challenging aspects of running a successful car company. This year’s election, and the upcoming shift in government regulations will be more consequential to the automotive industry than any previous election.

The disconnect between current electric vehicle regulations and real-world consumer demand has put traditional automakers on an impossible path. They've invested billions in rapid EV development even as sales have lagged and cars have piled up on dealer lots.

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We expect the Trump administration to carefully assess and ultimately replace the existing MPG mandates, (equating to an EV mandate) with a policy that better recognizes market reality. This is net positive for traditional automakers, but it could mean even slower growth in EV sales and a tougher road ahead for electric vehicle brands like Lucid, Rivian, and Tesla.

Consumers have not jumped on an all electric vehicle path and have chosen hybrids, plug-in hybrids, and gasoline as their preferred choice. Electric vehicles will always be in the mix as long as consumers want them.

We’ve seen the results of that on a global basis where mandates have forced manufacturers to produce product that consumers don’t want. As for Tesla, it is the leader in the electric vehicle segment. In addition, it is an American made brand, meaning it will bypass many U.S. tariff related issues other OEMs can't currently avoid, allowing it to continue succeeding.

With Trump’s administration in charge, an executive order could quickly roll back these standards, easing pressure on automakers to meet current emissions goals by transitioning to EVs. How soon until the automaker CEOs make formal requests to Trump to abolish the EV mandate? Can we finally abolish CARB (California Air Resources Board)? Now is their time to save themselves.

So far, 17 states, including California, have adopted the program. Across states that have adopted the ZEV program, the average number of EVs per 10,000 residents is more than double that of states that haven’t adopted the program.

Trump’s advisers have drafted language aimed at revisiting Clean Air Act waivers that allow California to enforce its own, stricter pollution standards — a move that could weaken the state’s power to drive the national EV agenda. California not only leads the country in EV adoption, it is also responsible for creating the Zero-Emission Vehicle (ZEV) program, which requires new vehicles to reach 100% zero-emission and clean plug-in hybrid-electric status in California by the 2035 model year.

We will be watching all the new rules and regulations and keep you posted.

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Lauren Fix, The Car Coach is a nationally recognized automotive expert, media guest, journalist, author, keynote speaker and television host. A trusted car expert, Lauren provides an insider’s perspective on a wide range of automotive topics and safety issues for both the auto industry and consumers. Her analysis is honest and straightforward