Michigan’s EV transition in limbo as Trump halts climate spending

• President Donald Trump has ordered the federal government to ‘immediately pause’ spending from key federal climate programs
• The pause creates uncertainty about the fate of billions of dollars in federal subsidies promised to Michigan for everything from EV chargers to critical minerals mining and nuclear power
• As of Tuesday, business and environmental leaders were still trying to suss out the implications

President Donald Trump has ordered a freeze on all unspent funds from federal climate programs that have funneled billions of dollars to Michigan, sparking uncertainty about impacts to the state’s EV and energy transitions.

As part of a wide-ranging effort to dismantle former President Joe Biden’s climate and environmental policies, Trump on Monday commanded all federal agencies to “immediately pause” spending tied to the 2022 Inflation Reduction Act and the 2021 infrastructure law, “including but not limited to funds for electric vehicle charging stations.”

If Trump follows up with a push to cancel grant awards or claw back unspent funds — a campaign promise that experts say is easier said than done —  the implications for Michigan could be big. 

Michigan has won more IRA-funded projects than any other state, from $500 million to retool a General Motors plant in Lansing to $1.5 billion to reopen the Palisades nuclear power plant. But only a handful of those 62 projects are operational, leaving the rest potentially vulnerable.

Gov. Gretchen Whitmer’s office is reviewing the impacts of the funding pause, said spokesperson Stacey LaRouche.

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On the EV charger front, Michigan has so far spent just $2.2 million of the $110 million the federal government earmarked for the state from the National Electric Vehicle Infrastructure program through 2026. 

The feds have authorized Michigan to spend a total of $77.2 million, and “the hope is that the funds already obligated will not be clawed back,” said Jeff Cranson, a spokesperson for the Michigan Department of Transportation.

But at the very least, the funding pause raises questions about the more than $30 million that the federal government has yet to award to Michigan.

The uncertainty threatens to slow efforts to expand the state’s EV charging network, which in turn could hinder automakers’ efforts to sell the public on EVs. 

Gov. Gretchen Whitmer has set a goal to install 100,000 publicly accessible EV chargers in Michigan by 2030. But as of Tuesday, there were just 3,781 statewide, and state efforts to expand the network have relied primarily on federal cash.

‘Job killers’ vs. climate change

The spending freeze is part of a broader Trump administration push to reverse Biden-era policies that favor EVs, which Trump has often referred to as “job-killers.” Trump has also promised to cancel a $7,500 federal tax credit for EV purchases and rescind fuel economy standards that are encouraging automakers to shift to EVs. 

“We will revoke the electric vehicle mandate,” he said in his inaugural address, “saving our auto industry and keeping my sacred pledge to our great American autoworkers.”

Taken together, those policies could have major implications for Michigan’s auto industry and efforts to forestall climate change.

Leading climate scientists have warned that society must stop emitting greenhouse gases by midcentury or risk runaway warming marked by worsening natural disasters, droughts, extreme heat and ecosystem loss. Transportation is the leading source of greenhouse gas emissions in the US.

“We knew this was coming, and the stakes are enormous,” said Mike Garfield, director of the Ann Arbor-based Ecology Center, an environmental and public health group. 

But Garfield said it’s too early to tell how Trump’s pro-fossil fuel, anti-EV push will impact the overall energy transition. 

“A lot of the investments have already been made, and industry is moving forward,” he said. 

The Detroit Three automakers, initially slower to invest in EVs than competitors like Tesla and Chinese automaker BYD, have invested billions in recent years to retool factories in hopes of catching up as the global market rapidly shifts toward EVs. State lawmakers have added taxpayer money to the effort, committing some $2 billion to entice automakers to build EV factories in Michigan. 

Yet while EVs are expected to surpass half of all vehicle sales in Europe and China by the end of this decade, adoption in the US has been slower, forcing Detroit automakers to revise their timelines for going fully electric and delaying the jobs growth that was promised in return for taxpayers' investments.

Any major shift in federal automotive policy could further extend the timeline, said Glenn Stevens, executive director of MichAuto, which is affiliated with the Detroit Regional Chamber.

“This is an industry that craves and needs stability,” Stevens said. “It's a capital intensive, long lead time, tight margin business with a very complex supply chain.”

Top industry officials have blamed customers’ slow uptake of EVs in part on a lack of public charging infrastructure. Research shows “range anxiety” still discourages many drivers from buying an EV. 

One charging company executive expressed optimism Tuesday that Michigan’s charging network will continue to expand, with or without federal investment. 

“It's not great news,” said Abass El-Hage, owner of the Detroit-based company Red E charging. “But I don’t think it's catastrophic.”

Utilities like DTE Energy and Consumers Energy are still heavily subsidizing EV charger installation across the state, and the growing popularity of EVs means charging stations are getting busier, making it easier for companies to justify the investment.

Loren McDonald, chief analyst at the EV charging analytics firm Paren, said a loss of federal funds for EV charger expansion would disproportionately affect rural areas, which he described as “charging deserts” where companies still struggle to justify the expense of installing chargers without subsidies.

“There’s still going to be a lot (of chargers) going in the ground in those more urban and suburban areas where they make financial sense,” McDonald said.

As for how Trump administration policies could affect the broader EV transition? Stevens, of MichAuto, said he expects US automakers to continue shifting toward EVs, but at a “more measured” pace. 

“This is a technology that is not going to go backwards or stop,” he said. “It is going to progress, but it is going to be decided ultimately by the consumer and the products that are available.”