Tariffs imposed by the Trump administration mean the car market, including electric vehicles, will be in a state of flux.
Ford’s latest advertisement leaves little doubt about its emphasis: “The Ford Motor Company would like to take a moment to address the idea that every American car company has pulled up stakes and off-shored everything that isn’t nailed down.” It goes on to stipulate that eighty percent of Ford’s vehicles are made in America, as are one hundred percent of the F-series, once the most popular vehicle in the United States.
Ford is the latest example that automakers are not waiting to see what tariffs will mean or what trade deals will come to pass. They are aggressively attacking a new marketplace logic that concerns itself not with efficiency or luxury; instead, they have pivoted to declaring their dedication to producing cars in the United States and highlighting the investments that they have already made into “made in America.” Although their campaigns will reach a broad audience of consumers, they seem most designed for an audience of one.
And, electric vehicles (EVs) are demonstrating their robust role in the overall fleet by being a primary consideration of the new marketplace.
Disrupting the Auto Market
Uncertainty rules the industry at present. The Trump administration has vowed to create tariffs on all imported vehicles after a ninety-day review period. Even the rumored twenty-five percent tariffs on cars made in Mexico or Canada, says the head of Ford, would “blow a hole in the U.S. industry that we have never seen. “
But EVs are a major portion of the industry’s calculations. Following the trend to transition to an electric-powered fleet—some targeted by 2030, others by 2050— automakers have already adopted massive shifts meant to align with, and take advantage of, new power sources. Their efforts had been focused on creating a smooth transition in consumer minds for such a dramatic change. That priority, though, appears to be a lesser concern.
Trump has voiced his distaste for the new vehicles—except for Teslas—and then made auto imports a target for the tariffs that he expects to correct perceived larger trade imbalances. At the ground level, though, the industry does not view this as a shift from EVs.
Practicality at the Factory-Level
New factories can not be created on American soil immediately. “This is a very long-term business, ” said Volkswagen Group’s president. A lot will depend on how the new tariffs and policies are designed, which makes it critical for the automakers to present their situation to consumers immediately.
BMW, for instance, in its new ad campaign, focuses on the $14 billion the German carmaker put into constructing its new factory in South Carolina and the 120,000 American workers that it says it employs.
In all cases, the new ad campaigns neglect to mention that the new investment over the last few years was largely the result of President Biden’s initiatives, such as the Inflation Reduction Act of 2022. This policy provided subsidies, loans and tax credits to spur companies to make domestic EVs so that China and other nations could not take over the emerging EV market.
Car makers report that they have invested $78 billion in projects related to EVs that have created 280,000 American jobs. A clear emphasis has been on manufacturing batteries, including the South Korean manufacturer LG, which operates three factories in the United States. The batteries that they produce supply General Motors and other American companies.
It is reported that four more factories will soon be up and running. So, it does not appear that EVs are going away—quite the opposite.
Complex Negotiations
Ultimately, though, automakers know that there will be no easy answers to these new policies. Even in the EV market, for example, American companies rely on China for key battery components. There is a murky aspect to how the new regulations will be applied to vehicles manufactured in America but including components and parts from abroad.
While policymakers work out such details, automakers are making sure to control what they can and will continue to emphasize a more subtle strategy that focuses on what they have already brought to the United States. We can expect to see even more evidence of the roots of automobiles, such as the popular Ford Bronco, suddenly proclaiming its origins dating back to 1966. The only difference might be that today’s Bronco uses a charging station and not a gas pump!
In the end, the real story may be that the industry negotiates the path forward with EVs as a primary consideration—a basic component of the American fleet of vehicles.
Brian C. Black is Distinguished Professor of History and Environmental Studies at Penn State Altoona and author, most recently, of Ike’s Road Trip: How Eisenhower’s 1919 Convoy Paved the Way for the Roads We Travel. (Godine, 2024). ENERGY TRANSITION 2025 is an ongoing series to place details of our current energy shift into historical context.
Image: Shutterstock/Aliaksei Kaponia
