About three and a half years ago, the American auto industry made a big bet on electrification, with the help of the Biden administration. It has been obvious to informed observers for at least a decade that EVs are where car production as an industry is going to land, sooner or later. They are faster, simpler, cheaper to run and maintain, dramatically more efficient, and most importantly, produce no direct carbon emissions, when stacked up against cars running on fossil fuels.
So, the Inflation Reduction Act contained a large subsidy package for the manufacture and sale of EVs. Automakers got a variety of subsidies for building batteries and EVs, while car buyers got a $7,500 tax credit for purchasing them. That way, the Big Three—General Motors, Ford, and Stellantis—could start to catch up with Chinese companies, which stole a march on America the first time Trump threw a wrench into the EV transition. Thanks to the IRA, the Big Three could claim a piece of the global auto market going forward.
Then the American people, in their infinite wisdom, elected Donald Trump, and he proceeded to stab the American auto industry directly between the shoulder blades. Almost all of the EV subsidies in the IRA were repealed, as part of Trump’s One Big Beautiful Bill Act. Now, thanks to that betrayal, plus Trump’s lunatic trade and foreign policy in general, the American auto industry is bleeding out.
Consider Canada, which has historically been one of the biggest markets for American cars, being quite similar culturally, already heavily integrated into the U.S. auto industry (along with Mexico), and also one of the few places that will buy our big stupid trucks. America’s share of the Canadian auto market has been tumbling, down from about half in the previous decade to just 36 percent, because of Trump’s deranged trade war and threats of annexation, which has sparked a massive nationalist backlash and a mounting customer boycott of anything American.
Canada’s Liberal prime minister Mark Carney almost certainly would not have been elected without Trump’s lunatic aggression. Now, he is quietly attempting to detach Canada from its dependence on American trade wherever possible. Last week, he announced a trade deal with China whereby Canada would exchange a greatly reduced tariff on Chinese cars in exchange for a big increase in China’s imports of Canadian canola seed, along with several other agreements.
This is the kiss of death for American car sales in Canada. You can get a Chinese Xiaomi sedan with 300-plus miles of range, more than 600 horsepower, and extremely fancy luxury trimmings for the equivalent of about $42,000 in China; or you can get a Chinese BYD Seagull with 190 miles of range for about $11,000. I would bet that the next step for Chinese automakers is to build a factory in Toronto or somewhere nearby so Canada can get a slice of the jobs and production.
More broadly, the American EV transition has clearly hit the skids, thanks to Trump. Sales plummeted by about 46 percent when the tax credit for purchase expired at the end of September. Ford took a $19.5 billion bath on a planned battery factory investment, canceled its F-150 EV, and is now reportedly in talks with—wait for it—BYD to pick up batteries for its hybrid cars sold abroad. GM is doing better, but its EV sales are still down sharply, as are Tesla’s.
Contrary to the triumphalism of various EV critics, all this horrendous waste does not mean that the global EV transition is now in question. As I have previously detailed, in 2025 a quarter of global car sales were EVs, led by Southeast Asia, where the EV share of new car sales in several nations has soared past the 40 percent mark, with many more nations just behind. China, the largest car market in the world, went from almost zero to more than half in just five years. America’s failure to gain a serious toehold in EV production—particularly very cheap models—is a major reason why the Big Three’s share of the global auto market has fallen from nearly 30 percent in 2000 to about 12 percent today, while China’s share has risen from 2 percent to 42 percent.
And this is just the start. If the staggering fall in battery prices over the last year is any indication, EVs are still in the period of industrial development where both technological advancements and price declines are rapid. And critically for the developing nations like India, Pakistan, and Nigeria that will likely make up most of the economic growth this century, they allow nations to shake off the heavy burden of oil imports.
The EV transition isn’t over even in America. As Andrew Moseman points out at Heatmap News, EVs are still straight-up better than gas cars for most purposes, and even our network of DC rapid chargers, while wretched by Norwegian standards, is good enough to make road trips workable in almost all of the country. Cheaper models like the Chevy Bolt or Equinox, Toyota bZ, or the Nissan Leaf are coming to market just in time. Who knows: Perhaps in 20 years, a desiccated husk of what once was Ford or GM will still be clinging to life.
It’s ironic, given Trump’s fixation on “manly” blue-collar professions, that the only companies he actually throws his weight around to protect are Big Tech monopolies. When Europe ponders enforcing its laws regarding child pornography on Elon Musk’s Twitter/X, then the administration is quick to issue retaliatory threats. But American auto manufacturers? Those Trump will kill with his own hand.