What the EPA's rollback of the "endangerment finding" means for the auto industry

In February, the Environmental Protection Agency scrapped what’s called the “endangerment finding.” It was issued back in 2009, under the Obama administration, and it determined that greenhouse gases threatened public health.

Automakers have a vested interest in the rolling back of these regulations, since it frees them from costly tailpipe emissions rules. But while some automakers appear to welcome the news, others — including Tesla — have expressed some skepticism.

For more, “Marketplace Morning Report” host Sabri Ben-Achour spoke with David Whiston, an auto analyst at Morningstar. The following is an edited transcript of their conversation.

Sabri Ben-Achour: So, some automakers seem to welcome this deregulation; others are a little more skeptical. What are the upsides and the downsides of this move from the perspective of the auto industry?

David Whiston: Yeah, I think that depends who you are and what was your EV and zero-emission vehicle exposure prior to the rules changing. I mean, the most extreme example, of course, is Tesla, which only sells electric vehicles, so they can't sell compliance credits to American competitors anymore. With the endangerment finding getting repealed, the greenhouse gas regulations are literally gone. That's pretty drastic by the Trump administration.

Ben-Achour: For companies that maybe have not gone as hard on electric vehicles, what do these rule changes mean for them?

Whiston: So, in the near term, the good news for these companies is they can continue to just make what they're perhaps the best at, which is making full-size SUVs and pickup trucks that are extremely profitable. And you can make that now without also having to pay compliance penalties or go out and buy credits from firms such as Tesla. And so, I think the question here is, do you just forget about zero-emission vehicles and only focus on gas guzzlers? Well, that's probably not a good idea, because longer term, the industry is likely to keep moving towards zero-emission vehicles as battery costs come down.

Ben-Achour: So, some automakers have invested, as you mentioned, billions into EVs. They don't have to walk back those new models, those new factories. It's just that they can if they want to. Why do they want to?

Whiston: Basically, the industry probably went too far. Go back in time several years ago: Tesla's skyrocketing in market value, and then regulation was certainly looking very much on the side of pushing the industry to EVs. So late last decade, a lot of automakers started making very large investments in EVs. The Trump administration has reversed all those regulations, and that's now got automakers saying, “Well, I can keep making vehicles that I probably can't sell, or we can just take some impairments and change production.”

Ben-Achour: But there's also the argument that the future is electric, and if they don't move, they will eventually be left behind.

Whiston: There's definitely a risk that the U.S. auto industry could lose in the long run from this change. I'm not saying that's definitely going to happen, because I think in the near term, I think their profits are going to be helped. But again, I think you're going to see EVs come roaring back. Now, is that going to happen in ‘27 or ‘28? Probably not. But in the 2030s, I think it certainly could happen. And I think it's a matter of time before the Chinese are selling here too. And so, if you're not investing now for that future, you're probably going to be in a lot of trouble next decade.

The Trump administration and EVs

• From February 2026: Burning Questions: The EPA repealed the endangerment finding. Who are the economic winners and losers?

• From December 2025: A whiplash year for electric vehicles

• From November 2025: Tax credits and regulations are gone, but EVs are probably here to stay