Trump removed subsidies, halted projects and supported oil; now the war against Iran makes gasoline more expensive and pushes the market towards electrification
In an ironic twist, Donald Trump — who dedicated the first months of his term to dismantling the automotive electrification policy in the United States — became the biggest unwitting driver of electric car sales in the country. That’s because the war against Iran, which began under his command, made gasoline more expensive and pushed American drivers to the very cars he tried to bury.
Early in the administration, Republicans overturned the $7,500 tax break for electric vehicles, suspended electrification projects already approved and strengthened support for the oil and gas industry, which benefits from billionaire subsidies. It was the strategy to stop a technology seen as a threat to fossil fuels. But it didn’t work out so well.
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The effect of the conflict was reversed: data from the consultancy Edmunds, released by CNBC, show that, in January, 67.1% of buyers of zero-kilometer electric vehicles delivered a gasoline car in exchange – in April, the index jumped to 72.1%.
Electric car owners are also more loyal. At the beginning of the year, only 26.2% of those who changed vehicles chose another new electric vehicle; in April, the number rose to 35.4%. Among used cars, the buyback went from 34.3% to 44.5% in the period.
Experts, however, warn that two months of data still do not allow the end of gasoline cars to be decreed – part of the change may just be an immediate reaction to prices at gas stations. For Ivan Drury, director of research at Edmunds, in six months the effect should attract even more drivers tired of tight pockets, especially if other costs also rise.
Analysts at Cox Automotive point out that high interest rates slow down those who have a vehicle in good condition and would think of changing it just to save money at the pump – a scenario that differs from the peak of fuel prices in 2008, when Americans abandoned large SUVs en masse for compact sedans. Without an agreement that guarantees the safe passage of oil through the Strait of Hormuz, electric sales could skyrocket.
