In the United States, the shift toward electric vehicle (EV) production and associated factory jobs has encountered significant setbacks, with several large-scale projects halted and thousands of factory workers laid off. This trend, emerging over the past two years, reflects a complex interplay of policy changes, market dynamics, and evolving consumer preferences.

One notable example is the battery manufacturing plant in Lordstown, Ohio, a joint venture between General Motors (GM) and South Korea’s LG Energy Solution. Opened in 2022 amid broad optimism about a U.S. EV manufacturing resurgence, the $2.3 billion facility initially employed around 1,300 workers. However, in late 2024, the joint venture Ultium Cells announced a pause in production effective January 2025 due to slow EV sales, leading to the layoff of approximately 480 employees and the temporary idling of hundreds more. Production resumed in mid-August 2026 but with a reduced workforce, leaving about 600 workers still on indefinite layoff.

Industry analysts and local workers cite a combination of factors for this downturn. The expiration of a federal $7,500 tax credit for electric vehicle buyers, eliminated shortly after the 2024 U.S. presidential election by then-President Donald Trump and congressional Republicans, is frequently cited as a critical blow to consumer demand. This tax credit had been aimed at stimulating EV sales and supporting domestic manufacturing. Following its removal, EV sales declined sharply, prompting automakers to reconsider or cancel planned investments in EV and battery production.

The broader industry impact is reflected in data from Atlas Public Policy, a clean-energy investment research firm, which estimates that nearly $20 billion in EV-related projects were canceled between 2025 and mid-2026, jeopardizing some 27,000 jobs. Notably, about 80% of these canceled projects were located in states that supported Trump in the 2024 election, a region often called the “Battery Belt,” stretching from Georgia to Indiana.

Automakers have linked these cancellations not only to waning consumer interest but also to policy uncertainty and regulatory shifts. Ford CEO Jim Farley described the collapse in sales following the tax credit’s end as decisive in scaling back the company’s EV investments. The Trump administration’s efforts to roll back fuel-economy rules and support fossil fuel development have encouraged a return to traditional gasoline vehicle production. For instance, Ford is converting a planned Tennessee EV assembly plant to produce gasoline-powered vehicles, delaying the ramp-up of EV manufacturing.

Some automakers, including Stellantis, have publicly scaled back EV projects, opting instead to develop large, gasoline-powered trucks favored by the U.S. market. Stellantis canceled a $6 billion battery complex in Indiana and discontinued plans for an electric Ram truck. Executives from the company praised regulatory changes under the Trump administration as more aligned with current market demand, allowing a broader portfolio of vehicle types.

Local communities that had anticipated economic revitalization through EV investments face considerable challenges. In Glendale, Kentucky, the BlueOval SK battery plant, a $5.8 billion Ford and SK On joint venture, abruptly laid off roughly 1,500 workers in late 2025 amid cutbacks. Residents and former employees express frustration, attributing the setback either to overly rapid industry transitions or to government mandates they perceive as forcing unwanted shifts toward EVs.

U.S. EV and battery manufacturing had experienced a brief boom between 2019 and 2024, fueled by government incentives under multiple administrations, including the Biden administration’s stricter fuel standards and subsidies for battery production. During that period, announced EV manufacturing projects more than doubled compared to previous years. However, the shift remains fragile amid fluctuating policies, with the U.S. losing ground to Europe and China—regions where EV sales and infrastructure continue to grow rapidly, supported by consumer demand and generous government incentives.

While the pivot back to gasoline-powered vehicles may offer short-term profitability for automakers, experts warn it risks leaving the U.S. industry behind in the global transition to electric transportation. Susan Helper, a professor of economics at Case Western Reserve University and former industrial adviser to the Biden administration, noted that the country may fail to produce the kinds of vehicles that dominate international markets in the future.

Efforts to repurpose idled EV battery factories for energy-storage battery production, driven by sectors like AI and data centers, are underway but are unlikely to absorb the full workforce displaced by the EV manufacturing slowdowns. As factory employment shrinks, communities once buoyed by hopes of an EV-driven renaissance grapple with the uncertainty of their economic futures.