California Governor Gavin Newsom pledged state-level support to maintain California’s leadership in clean transportation, using funds from the state’s ‘cap and trade’ program|Gage Skidmore|CC BY-SA 2.0
California Governor Gavin Newsom announced plans to provide rebates for electric vehicle buyers if President-elect Donald Trump eliminates the federal EV tax credit that offers customers as much as $7,500.
Newsom stressed the state’s dedication to clean energy and affordability, proposing to revive a rebate program that helped fund over 594,000 EVs from 2010 to 2023, saving 456 million gallons of fuel. The state’s Clean Vehicle Program also provides rebates of up to $7,500.
Tension between California and Trump
Newsom’s announcement signals renewed tension between California and Trump, whose previous administration was sued by the state over 120 times on issues including environmental policy.
Trump’s transition team has indicated a desire to cut EV tax credits, favoring oil and gas interests.
According to Bloomberg, Newsom’s program would not include Tesla EVs.
California has led EV adoption, with over two million zero-emission vehicles sold. Battery-operated cars accounted for 30% of auto registrations in the San Francisco Bay Area in 2023.
Newsom’s proposed rebate program, requiring legislative approval, could rely on the state’s $5 billion annual “cap and trade” fund. Despite budget challenges, California mandates all new vehicles sold by 2035 be emissions-free.
Industry reactions and future impact
The auto industry largely opposes repealing the credit, citing its role in boosting EV adoption. Analysts warn its removal could slash new EV registrations by 27%.