What will Trump’s impact be on climate in general and the EV in particular?

The election of Donald Trump as the next American president is terrible news for the climate, says KU Leuven professor Katja Biedenkopf, an expert on climate negotiations. “Trump has already announced that he will support the oil and gas industry and reduce or abolish Biden’s climate-friendly actions.”

The stock market also reacted to the election. Trump supporter Musk’s Tesla went up almost 15%, and the shares of companies that have to import in the US went down. BMW CEO Zipse and others have already expressed their views on this.

Decision reversing easy

Biedenkopf points out that reversing climate decisions in the U.S. would be easy for Trump because they were mostly ‘executive orders’ and no laws. So Trump can quickly abolish them, and Biedenkopf expects he will immediately begin with it after its inauguration.

The professor has no high hopes for the next four years on the national level in the U.S. Nevertheless, she points out that many climate policies are decided at the state or city level. “They can provide a counterweight and will do so,” she argues. U.S. states like California are already much further evolved and will continue to do so,” she reckons.

Next week, the COP29 climate summit in Baku (Azerbaijan) will start. “I’m curious to see the impact of Trump’s election victory,” says Biedenkopf. “Maybe the American delegation will do its utmost best to sign some new agreements at the last minute. But the most important will be Trump’s influence on other countries: why should a country like China continue to invest heavily in climate transition if the U.S. is doing the opposite?”

Here to stay?

Others don’t see the climate future so gloomy. Mack Hogan from InsideEVs says the electric vehicle revolution cannot be stopped. “It won’t be stopped by car companies, consumers, or the president. The EV revolution is happening. The only thing left to decide is whether America wants to lead it or be left behind.”

“Had an all-out push to stop EVs materialized ten, five or even two years ago, it may have succeeded. The EV market was new and underdeveloped. Few companies on any continent were making much to get excited about,” he notices.

“But in the past two years, the market has been flooded with relatively affordable, long-range, fast-charging EVs that buyers love. Consumers across the globe are interested in and comfortable with EVs as an option,” Hogan argues.

“People like EVs. Get someone past the initial hesitation, give them a bit of education, and it’ll be their favorite car they’ve ever owned. That doesn’t mean the problems with them are solved. Prices are still too high, and the formula doesn’t really make much sense for trucks with current battery chemistry. Charges for those without plugs at home or work are a true barrier,” he continues.

And he concludes: “But these are surmountable obstacles. The market will overcome them, whoever is in charge. Because the EV revolution is happening. Any smart American company isn’t going to let itself be left behind.”

At Electrek, they think along the same lines. “Nearly 9 in 10 American voters support clean energy incentives in the Biden administration’s Inflation Reduction Act (IRA), according to polling released by Global Strategy Group (GSG), North Star, and the Solar Energy Industries Association (SEIA). One thousand registered voters across the US were surveyed between August 1 and August 8, 2024.”

“Notably, 78% of 2020 Trump voters support federal clean energy tax credits, and only 10% of 2020 Trump voters strongly oppose IRA policies. There’s not an appetite among Republican base voters for Congress to repeal IRA provisions,” the website concludes.

“Every American wants lower electricity prices and greater energy security, and that’s precisely what federal clean energy policies are delivering,” said SEIA president and CEO Abigail Ross Hopper.

Andrew Baumann, partner at research firm Global Strategy Group, added: “The clean energy incentives passed as part of the IRA are wildly popular, including with Trump-supporting Republicans, and politicians from either party who want to repeal those incentives are putting themselves at great political risk.”

BMW downplays fears

BMW Group CEO Oliver Zipse immediately reacted to the possibility of higher import tariffs under Donald Trump’s presidency. Zipse sought to allay fears after presenting bleak third-quarter results yesterday, pointing to the company’s strong U.S. footprint, which includes its largest plant worldwide.

Fears over import tariffs, which Trump has also threatened on goods from the European Union, caused shares in BMW, Volkswagen, Mercedes-Benz, and Porsche to fall 5.2% to 7.7 %. Shares in Porsche, which has no production facilities in the U.S., hit their lowest level since its initial public offering in September 2022.

The U.S. market accounted for 12.9% of the 3.1 million German passenger car exports in 2023, making it the single-biggest market for Germany’s carmakers. The U.S. is increasingly lucrative for German automakers because of robust demand for large SUVs and a slower shift to EVs than in Europe, allowing them to sell more of their higher-margin ICE models.

During his campaign, Trump said he plans to impose duties on foreign-made cars shipped to the U.S. to protect local jobs. A trade conflict with Washington would create yet another problem for German manufacturers, who are already facing tough competition in China and muted demand in Europe.