Powering Through Policy: Strategic Navigation in a Transforming Policy Landscape 

The electric vehicle and battery industries have faced a period of rapid shifts. Seven months into the Trump administration, industry leaders face a very different landscape, with considerable changes to clean manufacturing and electric vehicle tax credits, an increasingly uncertain and evolving trade policy landscape, and unexpected shifts in federal vehicle emissions standards that are materially impacting market dynamics. Yet while some of these shifts are leading to headwinds, seismic policy changes often create opportunities – particularly when paired with strategic, proactive decision making.  

As discussed in Proterra's recent webinar "Empowering Policy in Today's Political Landscape," featuring our Head of Policy David Rubin and industry leaders from the Battery Materials and Technology Coalition, the path forward for the electric commercial vehicle and off-highway equipment markets presents a window for strategic positioning and innovative thinking to respond to these policy shifts and be prepared for the next period of growth.  

Highlighted below are key topics discussed in our webinar – you can listen here to learn more! 

Federal Policy Reversal Creates New Market Dynamics 

The "One Big Beautiful Bill Act," signed July 4, 2025, fundamentally restructures the American EV landscape. While certain benefits such as the 30D personal vehicle tax credit and the 45W commercial vehicle tax credit now face accelerated expiration, other tax credits such as the 45X advancing manufacturing credit were preserved – with new requirements to incentivize and shift supply chains towards onshore and friendshore opportunities.  

Our speakers viewed this as a tectonic shift in federal policy: while some aspects of legislation such as the Infrastructure Investment and Jobs Act (IIJA) and Inflation Reduction Act (IRA) that have buoyed the industry are transitioning out, the Administration’s actions demonstrate that batteries and clean manufacturing are increasingly seen as a critical technology that will help support U.S. industrial leadership abroad for the years ahead. 

Key to this transition is a robust U.S. critical mineral market to support supply chain demand for inputs from non-Foreign Entity of Concern (FEOC) nations. Beneficially, nearly all obligated funding from sources like the Inflation Reduction Act (IRA) were preserved, providing stability for U.S. production and critical mineral processing projects as domestic capacity expands.  

Trade Barriers Reshape Global Supply Chains 

The webinar also touched on evolving U.S. trade policy – with the suite of new tariffs (including traditional Section 232 and Section 301, as well as less-tested authorities like IEEPA) impacting battery economics. The rapid shifts in these policies have created unique and tangible pain points for suppliers reliant on FEOC nations, particularly in sensitive and critical technology like batteries and semiconductors. While today’s global battery supply chain is still highly concentrated, those companies that have derisked and decoupled key aspects of their supply base will be best positioned for future market growth as policy signals increasingly point towards a more robust U.S. manufacturing base. 

As this market continues to evolve, forward-thinking companies are leading through shifting their supply relationships – be it upstream through anode and cathode sourcing, or more downstream manufacturers in assessing cell and battery pack suppliers. Vertical integration, alternative chemistries less exposed to geopolitical turbulence, and pioneering recycling technologies are increasingly valuable as well in insulating from market risk – the coming years are crucial in locking in resilient supply relationships, given the rising demand for content sourced from lower-risk markets.  

State Leadership Supplementing Federal 

Our speakers also touched on the shifting emissions regulations for electric vehicles across the nation, and what it means for states’ roles in accelerating growth. Despite Congressional action on California's waivers under the Clean Air Act for both passenger and medium/heavy-duty vehicles, states like California, New York, Washington, and others are continuing to push incentives and adoption targets, such as in the electric school bus segment, port equipment, and state and municipal fleets.  

And while federal emissions standards face an uncertain future, there are other regimes and programs that will continue to incentivize clean transitions, such as point-based air quality standards, clean fuel standards, and targeted funding through programs like HVIP, CORE, and others. An effective and well-positioned ground game in states leading this charge will remain critical for success.  

Total Cost of Ownership Shifts the Narrative 

As policy incentives undergo uncertainty, the speakers all agreed that total cost of ownership will now become the key driver in market demand. Working with fleet operators to better articulate the operational savings - reduced fuel costs, minimal maintenance, superior reliability - that often outweigh upfront premiums will be critical. In this lens, municipal fleets and high-mileage applications with predictable routes and duty cycles will remain the most attractive to electrify in the near-term. 

The market is increasingly shifting towards a reality where lifetime operating cost savings become the primary driver of demand. Achieving this TCO-centric cross-over point will be critical in achieving widespread adoption.  

Continuity Beneath the Chaos 

Concluding our discussion on how the policy landscape stands today, we turned toward the realities facing OEMs, suppliers, and vehicle purchasers today, and how they can best position for success.  

Despite surface turbulence, fundamental drivers remain unchanged. Despite the surface-level changes from the Biden to Trump administrations, key policy pillars remain unchanged – prioritization of a stronger domestic manufacturing base, increased supply chain security, and reducing U.S. dependence on FEOCs for strategic technology. While methods certainly differ, the direction remains consistent – and is unlikely to change, regardless of the next Administration. Companies that recognize this continuity, and leverage it proactively in their sourcing, manufacturing, and sales strategies, will be best positioned for success regardless of tactical policy shifts. 

Seizing the Electrified Future 

Proterra stands ready to power this transformation. Our integrated approach - combining industry-leading safety and reliability, proactive supply chain resiliency, and a robust U.S. manufacturing footprint - positions our partners for success across any regulatory environment, turning uncertainty into competitive advantage.  

As the EV market evolves, we are facing a chapter driven by economic fundamentals rather than political tailwinds. Yet the fundamentals remain the same: fleet operators will always seek operational excellence and cost-optimal solutions. Manufacturers will pursue supply chain security and positive-sum strategic sourcing decisions. Communities will push for healthier environmental outcomes, regardless of federal policy.  

The question isn't whether electrification proceeds – it is instead who will lead the charge.