Vehicle Manufacturers' Contribution to US Regulatory Instability

Introduction

In response to the Trump administration’s repeal of major US environmental regulations and federal subsidies, automakers are reporting losses of tens of billions of dollars as they retreat from EV production. The industry’s lobbying against environmental regulations, however, may have contributed to the regulatory instability that it now faces.

US automakers have often emphasized the need for stable environmental regulations, citing the substantial time required to develop and manufacture new vehicles. Despite this, many of these automakers have lobbied for years to roll back US emissions regulations, counter to a strong global trend towards the electrification of road transport, further accelerated by high oil prices resulting from the conflict in Iran, and the Intergovernmental Panel on Climate Change (IPCC)’s warnings that ambitious government regulations are needed to decarbonize the industry. At the same time, they have inadequately disclosed these lobbying activities, keeping their own investors in the dark about their lobbying for the rollbacks that are causing regulatory chaos for the industry.

Now, the US automotive industry appears to be in crisis. Manufacturers are rapidly pivoting away from their decarbonization strategies, which, in addition to substantial financial losses, leaves them behind in the global EV production race and poorly positioned to comply if a future administration reinstates US environmental regulations—as the Biden administration did after regulations were weakened under the first Trump administration.

A History of Harmful Lobbying

Many car manufacturers recently suffered multi-billion dollar losses from a retreat from electric vehicles: Stellantis announced a $26.2Bln loss, Ford $19.5Bln, Honda $15.7Bln, and General Motors $6Bln, with other manufacturers expected to follow suit in the near future. All of these manufacturers, along with most of the US automotive industry, lobbied against established climate regulations, such as Advanced Clean Cars II, Advanced Clean Trucks, and federal GHG emissions standards, that would have pushed the market towards electric vehicles. With ambitious regulations to decarbonize road transport, manufacturers would have been required to maintain their EV investments to comply. Instead, through their negative advocacy on climate policies, manufacturers have undermined their long-term stability.

Advanced Clean Cars II

The Advanced Clean Cars II (ACC II) regulation was adopted by 12 states and required manufacturers to sell increasing numbers of electric vehicles, reaching 100% of vehicle sales by 2035, covering 32% of the total US vehicle market. Before their recent costly retreat from EVs, many automakers had EV sales targets that far exceeded 32% by 2035, such as General Motor’s target of 100% EV sales by 2035 or Stellantis’ target of 50% EV sales by 2035. However, the Alliance for Automotive Innovation (the Alliance), an industry association representing the manufacturers listed in Table 1 and most global automakers, pushed the federal government to repeal the ACC II rule in February and April 2025. In May 2025, the Alliance for Automotive Innovation, Stellantis, General Motors, and Toyota also supported a bill that would repeal ACC II. This lobbying has drawn negative attention from major politicians and regulators: California Governor Gavin Newsom is reported to harbor a personal grudge against GM CEO Mary Barra for the company’s opposition to ACC II, and when automakers sided with the Trump administration’s rollbacks in 2019, the state issued a notice that it would not purchase vehicles from automakers that were not compliant with its regulations, such as General Motors.

Advanced Clean Trucks

In the heavy-duty sector, truck manufacturers have flip-flopped on the Advanced Clean Trucks (ACT) policy, a regulation that required manufacturers to sell increasing amounts of electric trucks in participating states. In 2022, truck manufacturers opposed ACT, with a coordinated lobbying campaign across multiple US states. In July 2023, the major manufacturers reached a compromise with regulators to meet the goals of Advanced Clean Trucks in California and to cease oppositional lobbying campaigns in other states. Signatories of this Clean Trucks Partnership included Cummins Inc, Daimler Truck North America, General Motors Company, Hino Motors, Ford Motor, Volkswagen subsidiary Navistar, PACCAR, Stellantis, Volvo Group, and the Truck and Engine Manufacturers Association (EMA). In 2025, however, some of these companies again reversed their positions: Daimler Truck, PACCAR, Volvo Group, and Volkswagen subsidiary International Motors filed a lawsuit against California in August 2025, seeking to void the Clean Trucks Partnership, and the EMA opposed the ACT in July 2025 regulatory comments.

Although the Trump administration has now rescinded California’s authority to enforce ACC II and ACT, this does not mark the end of California’s regulatory efforts to decarbonize the sector. After the first Trump administration paused the rules in 2019, the Biden administration reinstated California’s regulations in 2022. After the most recent regulatory rollback in 2025, the California government immediately took legal action to restore its rules and began developing alternative strategies to regulate the transport industry if ACC II is not restored.

GHG Emissions Standards

For years, auto manufacturers have lobbied to weaken GHG emissions standards. Under the Biden administration, light and heavy-duty vehicle manufacturers alike advocated for the government to weaken the overall stringency of emissions standards. The administration ultimately made concessions to the automakers, and weakened the stringency of both light- and medium-duty vehicles and heavy-duty vehicles from their respective original proposals. Since Trump’s re-election, manufacturers have grown more bold in their negative advocacy, calling for bigger cuts to regulations.

• In March 2025, General Motors, Stellantis, and Toyota endorsed the Transportation Freedom Act, which would repeal all existing GHG emissions standards and replace them with weaker ones.

• The Transport Project, which represents Cummins and Volvo Group, requested that the Environmental Protection Agency (EPA) rescind the existing heavy-duty GHG emissions standards for heavy-duty vehicles in a March 2025 press release.

This negative lobbying and opposition to GHG emissions standards preceded the Trump administration’s repeal of the 2009 Endangerment Finding, the legal foundation for federal GHG emissions standards. Only four automakers—Ford, Honda, Rivian, and Tesla—strongly opposed the repeal, specifically citing concerns about the impact on regulatory stability.

• Honda Motor: “This legal uncertainty could place the automotive industry (including automakers and suppliers) into a state of prolonged regulatory limbo, hindering long-term planning, U.S. investment, and product development cycles that span many years.”

• Ford Motor: “eliminating standards altogether is not likely to provide the industry with the long-term stability we need to make historic investments in America and compete globally.”

• Tesla: “This clear regulatory structure has provided incentives for continued innovation in motor vehicle technology and is vital to continued global competitiveness by companies based in the United States.”

The two main automotive industry associations in the US, the Alliance for Automotive Innovation and the Truck and Engine Manufacturers took dramatically different positions from the concerned automakers.

• The Alliance did not explicitly request that the government withdraw its proposal or maintain the endangerment finding, despite echoing concerns from its own members, Ford and Honda, that “the Proposed Rule represents yet another significant change in approach that the industry will have to navigate” and that “the approach also has the potential to further amplify the severity of policy swings in future administrations.”

• Representing the heavy-duty sector, the Truck and Engine Manufacturers Association initially stated that “vehicle manufacturers are not in a position to absorb or plan around those potential increased litigation risks” from the repeal of the endangerment finding. However, after the rollback was finalized, the association intervened in a lawsuit to support the repeal. The very same month, Traton, a subsidiary of Volkswagen, stated in its Annual Report that the repeal of the endangerment finding “​​presents significant regulatory and market risks” and “increases regulatory volatility, exposure to stranded asset, and potential misalignment with global sustainability trends.” International Motors, another subsidiary of Volkswagen, is a member of the EMA. Daimler Truck, the largest member of the EMA by market share in the US, also aligned itself with the Trump administration’s rollback in regulatory comments and supported a wholesale repeal of the endangerment finding and federal GHG emissions standards.

Multiple automakers and their industry associations acknowledge that future presidential administrations may seek to reinstate GHG regulations for road transport, the largest source of GHG emissions in the US. Yet much of the industry is leaving itself vulnerable to these outcomes by failing to advocate against, or in some cases, supporting, the “biggest deregulatory action in American history.”

A Strong Case for Disclosure

For years, US vehicle manufacturers’ negative lobbying—documented on the LobbyMap database—called for many of the deregulatory actions currently causing upheaval in the industry. Many vehicle manufacturers, however, do not fully disclose their lobbying strategies and activities to investors, including failing to disclose specific details of their positions on regulations in corporate reporting or federal lobbying disclosures. In doing so, companies leave their investors and stakeholders in the dark about engagements occurring behind closed doors that might pose risks to their business models. InfluenceMap analyzed the corporate lobbying disclosures of the members of the Alliance of Automotive Innovation and the Truck and Engine Manufacturers, covering most major light- and heavy-duty vehicle manufacturers in the US, and found that no major US manufacturer is fully transparent in disclosing its own direct policy engagement activities or the activities of its industry associations.

Without the regulatory incentive to adapt to the energy transition, US automakers are likely to face mounting challenges. Honda Motor stated that “Other major automotive markets around the world, including Europe and Asia, are continuing to tighten their emissions regulations… If the U.S. market were to become a ‘low-regulation’ outlier… Such regression would not only harm American consumers but also risk global competitiveness — ceding leadership in automotive innovation to other countries.” With improved disclosure of lobbying activities, investors can encourage companies to align their policy engagement with the IPCC’s recommendations and create a regulatory environment that keeps manufacturers competitive through the energy transition.