California to provide rebates for zero-emission vehicles if federal tax credit eliminated by incoming Trump administration

LOS ANGELES, Nov. 26 (Xinhua) -- California Governor Gavin Newsom said on Monday the western U.S. state will step in to provide rebates for zero-emission vehicle (ZEV) buyers if the incoming Trump administration follows through on its threat to eliminate the federal tax credit.

"We will intervene if the Trump administration eliminates the federal tax credit, doubling down on our commitment to clean air and green jobs in California," said Newsom in a statement, noting that "We're not turning back on a clean transportation future -- we're going to make it more affordable for people to drive vehicles that don't pollute."

California, the most populous state in the United States, continues to lead the nation in ZEV adoption, surpassing 2 million electric, plug-in hybrid, and hydrogen-powered vehicles sold across the state, home to around 10 million residents, according to the Democratic governor's statement.

In the third quarter of 2024, Californians purchased 115,897 ZEVs, representing 26.4 percent of all new vehicle sales in the state. Over 30 percent of new ZEVs sold in the country are sold in California, Newsom noted.

Newsom's statement pointed out that the state is spending billions to speed ZEV infrastructure deployment, tear down barriers, and deploy infrastructure in hard-to-reach and low-income areas.

The governor said if the Trump administration eliminates the federal tax credit, he will propose creating a new version of the state's successful Clean Vehicle Rebate Program, which was phased out in 2023. The plan has funded more than 594,000 vehicles and saved more than 456 million gallons of fuel.

Under the law, consumers can lower the purchase price of a new electric vehicle by up to 7,500 U.S. dollars.

"The EV rebate promise is only Newsom's latest move against the incoming Trump administration," commented The Sacramento Bee, a major newspaper published in the state's capital city.

"The governor's proposal comes not only as California officials gear up for a battle with the incoming Trump administration over environmental policy, but also amid growing concerns about rising energy costs in the state," the newspaper added.

Tesla's electric vehicles would be shut out from consumer rebates under the proposal by Newsom, pitting the prospective Democratic presidential hopeful against Republican power player Elon Musk, reported Bloomberg News.

His office told Bloomberg News that the current proposal includes market-share limitations that would exclude Tesla's popular EV models. The details, including Tesla's possible omission from the credits, will be negotiated with the state legislature and could change, said the report, citing Newsom's office.

Musk condemned the proposal on his X platform.

"Even though Tesla is the only company who manufactures their EVs in California!," said Musk, adding that "This is insane."