For nearly 60 years, California has been able to set its own standards around auto emissions that are stricter than the federal government’s, thanks to a special exception for the state under the Clean Air Act. California has used that waiver to implement aggressive emissions standards that prioritize the sale of EVs, and that aim to whittle down the sale of gas-powered vehicles until their complete ban by 2035.
Now Trump has signed a joint resolution from Congress that overturns that California waiver—and essentially kills California’s efforts to accelerate EV adoption (California has sued to stop the move). If its implementation is allowed, the resolution won’t affect only California residents, but would hurt the entire country’s EV efforts, and push the U.S. further behind the rest of the world.
“California has probably been the largest factor in accelerating EV adoption over the past decade,” says Jeremy Michalek, an engineering professor at Carnegie Mellon University and director of the school’s Vehicle Electrification Group. California has used its Clean Air Act waiver to set requirements for automakers to sell a certain percentage of vehicles that release zero tailpipe emissions (a requirement which, a few hydrogen powered prototypes aside, can currently be met only with electric vehicles). California has become the biggest market for EVs in the country, accounting for nearly a third of all EV sales in the U.S.
The California effect
When California sets stricter regulations around auto emissions, it changes what sorts of cars are available for drivers everywhere. “That’s been a huge driver in forcing the industry to provide additional options, like to roll out EVs in different market segments,” Michalek says. “If California sets stricter standards than the rest of the country, automakers have to decide, ‘Are we going to try to customize different vehicles for different markets and deal with all of the logistics and cost, or are we just going to make all vehicles comply with what California is doing?’” (California’s stricter rules also catalyzed stronger federal standards because the state has long been a part of federal emissions negotiations.)
This California effect has been noticed with other environmental regulations, too. A state law requiring product label warnings for toxic chemicals known to cause cancer led to chemical exposures decreasing for people across the country. When brands make a product to meet California’s strict environmental regulations, they usually sell the same one across the country, and everyone benefits.
If California’s stricter auto standards go away, it stands to reason that the entire country would lose out on that benefit, too. That wouldn’t happen immediately: It takes about five years for automakers to design and bring new vehicles to market. But the move—which California is already suing the Trump administration over—adds to the general uncertainty the auto industry is facing.
Automakers lobbied the Senate to end California’s ban on new gas car sales by 2035, and have spoken out in support of Trump’s recent move, saying there should be one national standard. But there’s still uncertainty because of the rapid changes to regulations, Michalek says.
The U.S. falling behind in EV transition
This move combined with the potential repeal of EV tax credits, Trump’s tariffs, and his administration’s efforts to weaken federal auto emissions standards all hurt the auto industry’s ability to plan long term. And if automakers can’t make investments in local EV battery factories or onshoring parts of the EV supply chain, that means the U.S. will continue to fall behind in the overall EV transition.
The move to EVs is already on a strong trajectory, Michalek says. Changing California’s emissions standards won’t totally stop that transition, but it will slow it down. “Meanwhile, the rest of the world is already ahead of us,” he says. China in particular is an EV leader—with technological advancements that have made ultra-affordable EVs a reality—and even countries across Europe are now outpacing the U.S. in EV sales.
Because of the Trump administration’s attacks on the Inflation Reduction Act as well, billions of dollars of investments into the EV industry have been canceled since the start of his second term, including plans for EV and battery factories. Part of the goal of the IRA was to diversify and relocate the supply chain for climate tech like EVs, moving it either into the U.S. or to its allies. But these pullbacks are making that plan more difficult.
“So by getting further behind,” Michalek adds, “the risk is that if we’re going to have to make this [EV] transition anyway, and we’re lagging behind in building the industry to make the technology, then when we do have to transition, we’ll be kind of at the mercy of other countries that are dominating the technology.” Eventually, he adds, we’re going to be at a disadvantage for not having made these investments sooner.
Chaos for automakers and states
Repealing California’s waiver could also hurt automakers that focus on EVs. Within the state’s (and federal) regulations, there’s been the option for automakers that weren’t able to meet the standards to buy credits from companies that did, so that on average the industry is meeting these goals.
“If there are some automakers who wouldn’t really sell electric vehicles unless they were forced to, because that’s not where their profit center is, it enabled them to transition some funding to other automakers that were more focused on electric vehicles, like newcomers like Tesla,” Michalek says. He credits California’s stricter standards for why, at least in part, Tesla was able to survive its early years.
California is currently the only state able to set its own auto emissions standards that are stricter than federal ones, but the Clean Air Act does allow other states to adopt California’s regulations, and 17 states, including Oregon, New York, and Massachusetts, have done so. In that sense, removing California’s waiver also directly affects what those other states can do around auto emissions. (Ten other states have joined California’s lawsuit against the Trump administration over its effort to revoke its waiver.)
In attempting to revoke the waiver, Trump went through Congress, but California Governor Gavin Newsom says that move was illegal. It’s not clear what the timeline will be for a resolution to the lawsuit. In the meantime, Michalek says, there’s a sustained sense of uncertainty for automakers. “The chaos of it is a deterrent to investment in the industry, and in planning for future vehicles.”
