While America Retreats, the World Accelerates on Electric Vehicles

20.7%. That's how much global EV registrations grew in 2025. In America? Just 1%.

At the 2026 Detroit Auto Show in January, electric vehicles were no longer the star of the show. Instead, automakers emphasized hybrids, updated gasoline models, and incremental efficiency improvements. This came just after Ford and General Motors announced $19.5 billion and $6 billion in EV-related write-downs, respectively.

While America pulls back from the electric transition, the rest of the world is hitting the accelerator.

The Numbers Tell a Story

The global shift is undeniable. China recorded 12.9 million EV registrations in 2025, up 17%. Europe hit 4.3 million, jumping 33%. The rest of the world added 1.7 million, surging 48%.

Meanwhile, U.S. EV sales growth was essentially flat. Tesla, the American EV pioneer, saw vehicle deliveries fall 9% and net profit drop 46%. CEO Elon Musk announced the company would shift focus toward artificial intelligence and robotics.

Perhaps most surprising is what's happening in emerging markets. Vietnam hit 38% EV market share, Thailand reached 21%, and Indonesia achieved 15%. This challenges the assumption that vehicle electrification would trickle down from wealthy to developing nations.

In the U.S.? EVs account for less than 10% of new vehicle sales.

Policy Paths Diverge

President Donald Trump returned to office promising to end EV support policies and boost fossil fuels. But while America curtails federal incentives, other governments are doubling down.

Europe maintained its goal of a 90% cut in automobile CO2 emissions by 2035. Germany launched subsidies worth 1,500 to 6,000 euros per electric vehicle for small- and medium-income households.

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Developing economies are sustaining EV transitions through industrial policy. Brazil's MOVER program offers tax credits explicitly linked to domestic EV production and R&D. South Africa introduced a 150% investment allowance for EV and battery manufacturing.

China has entered a phase of regulatory maturity. After a decade of subsidies that helped domestic firms undercut global competitors, Beijing ended its full tax exemption for EV purchases, replacing it with a 5% tax. With their domestic market saturated, Chinese automakers are pushing aggressively into global markets.

The Competitive Landscape Shifts

EV manufacturing is governed by steep learning curves and scale economies. The more vehicles a company builds, the better it gets at making them faster and cheaper. Low domestic production means higher costs and weaker bargaining power in global supply chains.

The results are already visible. China exported 2.65 million EVs in 2025, doubling its 2024 exports. BYD surpassed Tesla as the world's largest EV maker in 2025.

The U.S. risks becoming a follower in the industry it once defined.

Some argue American consumers simply prefer trucks and hybrids. Others point to Chinese subsidies and overcapacity as market distortions. These concerns deserve consideration, but they don't outweigh the fundamental fact that globally, EV market share continues rising.

What America Can Do

For U.S. automakers and workers to compete, the government must stop treating EVs as ideological and start governing them as industrial transition.

First, restore regulatory credibility. The Trump administration's move to roll back vehicle emissions standards undermines the predictable performance standards that drive industrial investment.

Second, focus on affordability and equity. The federal clean-vehicle tax credit expired in September 2025. An alternative is targeted, point-of-sale support for lower- and middle-income buyers, as California and Pennsylvania already do.

Third, keep building charging infrastructure. A federal judge ruled on January 23, 2026, that the Trump administration violated the law by suspending a $5 billion program for expanding the nation's EV charger network.

Fourth, use fleet procurement as a market stabilizer. When governments and companies provide predictable vehicle purchases, manufacturers can plan investments. Amazon's 2019 order of 100,000Rivian electric delivery vehicles gave the startup the boost it needed.