Once the pride of the global auto industry, America’s major car manufacturers now face a daunting challenge: keeping pace in the rapidly evolving world of electric vehicles. The auto giants of Detroit, once known for their innovation and mass production prowess, are now struggling to catch up in a game they seemingly underestimated.
In the 1970s, the American auto industry faced its first major setback with the fuel crisis, as Japanese imports outperformed local vehicles in fuel efficiency and reliability. The following decades saw economic downturns and a push for larger, costlier cars, compromising safety and global standing. Fast forward to the 2010s and 2020s, and the Big Three—Ford, General Motors, and Stellantis—missed the mark on electric vehicles (EVs). Their attempts to electrify existing models failed to match Tesla’s innovative edge, resulting in high costs and limited appeal.
The financial consequences of these missteps are now becoming apparent. Ford has reported a staggering $19.5 billion write-down on its EV investments, one of the largest ever seen. On the same day, they announced the discontinuation of the F-150 Lightning, a vehicle initially celebrated as a breakthrough akin to the Model T. GM followed with a $7.6 billion charge, and Stellantis faced a $26.6 billion loss. Combined, these losses amount to over $50 billion.
The failure to effectively transition to electric vehicles is often attributed to a lack of seriousness from Detroit, compounded by dealership resistance due to concerns over service and repair revenue. Additionally, political factors have played a significant role. President Donald Trump’s administration made EVs a contentious issue, exacerbating the industry’s challenges. The elimination of the $7,500 EV tax credit by Trump and Congressional Republicans led to a 43% drop in GM’s EV sales.
Trump’s policies further hindered progress by rolling back emissions regulations and challenging California’s authority to set its own pollution limits. Most notably, the Environmental Protection Agency under Trump rescinded the “endangerment finding,” which deemed greenhouse gas emissions a threat to public health. This allowed automakers to bypass emissions standards and climate credits, a move criticized by Margo Oge, a former top EPA vehicle emissions regulator, who stated that the US now lacks meaningful emissions standards.
Despite these setbacks, some industry experts believe the lack of stringent standards provides temporary relief for automakers to focus on developing profitable electric vehicles. Ivan Drury, director of insights at Edmunds, expressed hope that this period of “breathing room” will not lead to complacency but rather spur innovation and efficiency.
Globally, the transition to electric vehicles is well underway. In 2025, EV sales reached 20.7 million units, a significant increase from three million in 2020. Countries like Norway, Sweden, and China boast high percentages of EV sales, contrasting sharply with the US, where EVs account for only 10% of the market. Investments in battery technology and infrastructure have driven this growth abroad, with China alone investing between $150 billion and $250 billion.
The US could still reverse its current trajectory. California is opposing the repeal of its emissions waiver, which, if successful, could force automakers to navigate conflicting regulations. Ed Kim, president and chief analyst at AutoPacific, suggests that to remain competitive, American automakers must continue to invest in diverse powertrains, including EVs, to survive in a global market increasingly dominated by electric vehicles.
While Ford, GM, and Stellantis have expressed commitments to the EV market, the path forward is fraught with challenges. Yet, the global shift towards electrification continues unabated, leaving the US at a crossroads between innovation and obsolescence.
Original Story at www.theverge.com