How to make sense of job and project cuts in the EV sector

It’s been doom and gloom galore for the EV sector of late.

Amid slower demand and federal policy changes deprioritizing electrification, the industry is shedding jobs and delaying or canceling projects. In fact, 2025 has seen more clean energy manufacturing investments canceled than announced—a stark change from just a few years ago, when the US was on the cusp of an EV and battery manufacturing boom.

But some industry analysts say that despite some very real pain in the short term, the future remains bright for zero-emissions vehicles. In the meantime, buckle up for a bumpy ride.

Loren McDonald, CEO and chief analyst at Chargeonomics, compared today’s EV market to the early days of cellular technology.

“What history has told us now is we were actually in the BlackBerry phase, and still are. The product is good, but it’s not compelling enough for average consumers,” he said. “We haven’t actually reached the phase with the product that’s more like the iPhone, where everybody goes, ‘Oh my God, I need to have an EV, it’s so much better than my gas car.’”

Pump the brakes

In October, General Motors said it planned to indefinitely lay off 1,750 workers and temporarily lay off another 1,670 as it trims EV and battery production at plants in Michigan, Ohio, and Tennessee. Part of the plan includes temporarily idling GM’s Factory Zero plant in Detroit, which produces multiple EVs, and then resuming production with only one shift, according to InsideEVs. The production pause at two EV battery plants is slated to last until mid-2026.

“In response to slower near-term EV adoption and an evolving regulatory environment, General Motors is realigning EV capacity,” the company said. “Despite these changes, GM remains committed to our US manufacturing footprint.”

EV maker Rivian also recently announced 600 job cuts, with CEO RJ Scaringe reportedly telling employees: “With the changing operating backdrop, we had to rethink how we are scaling our go-to-market functions.”

And as The Wall Street Journal reported earlier this month, Ford is considering cutting its electric F-150 Lightning amid weak sales and mounting losses in its EV business. The WSJ also noted Stellantis’s canceled plans for an electric version of its full-size Ram pickup truck earlier this year and sluggish sales of Tesla’s Cybertruck.

Freudenberg e-Power Systems recently announced the closure of two EV battery plants in Michigan, resulting in 324 layoffs, The Hill reported; company leaders cited “the decrease in demand for heavy-duty electric and hybrid electric vehicles in North America.”

Rest of World published an analysis in September reporting that more than 30,000 workers had lost their jobs at EV manufacturers “and related industries worldwide over the past year” amid trade policy changes, weaker growth, geopolitical tensions, higher interest rates, and a more competitive market.

Research firm Atlas Public Policy, in partnership with the Environmental Defense Fund, recently tallied total cancellations representing nearly $21 billion in investments in clean energy manufacturing in the first three quarters of 2025. Battery projects have taken the biggest hit: 11% of announced projects were scrapped, mostly this year.

One bright spot: The authors noted that about four-fifths of active investments were under construction or operational, and Q3 had net positive investments. Since 2000, the clean energy manufacturing sector has drawn nearly $250 billion in investments, most announced since mid-2021, during Joe Biden’s presidency.

“Since 2021, the United States has experienced an unprecedented clean energy manufacturing boom, bringing hundreds of thousands of jobs to communities across the country,” according to the report. “However, the first nine months of 2025 have seen a stark change. Trump administration policies and cuts to clean energy tax credits have slowed growth considerably and threatened progress.”

The pullback comes on the heels of President Donald Trump’s tax and budget bill, which set Sept. 30 as the expiration date for federal tax credits on certain EV purchases. Atlas analysts pointed to “funding cuts and policy shifts” as the driving forces behind “cancellations of $20.8 billion and nearly 27,300 anticipated manufacturing jobs in 2025 alone.”

“When we think about the cancellations, it’s numbers for sure, but also this has a negative impact on communities that were anticipating preparing for economic opportunities from these clean energy projects, whether it was through the anticipated jobs themselves, maybe workforce development programs that the company and the community had agreed to establish,” Matthew Vining, a policy analyst at Atlas, told us.

Idling

If this all sounds bleak for the prospect of carbon-free transportation, some industry analysts view it as a short-term correction. What’s really happening, McDonald contended, is more complicated than just the fallout of tax credits going away. He sees the recent pullback as a result of how legacy automakers approached the launch of their first-generation EVs.

“[The end of the tax credits is] a real thing, but the automakers are using it as an excuse to pull back,” he said. “It allows them to take a deep breath and go, ‘Phew, now we can focus on selling those $80,000 fully loaded gas Chevy Tahoes and things like that,’ while they actually work on building their generation two, generation three EV models that are truly compelling.”

In some cases, legacy automakers converted existing internal combustion engine vehicles to electric rather than developing new platforms from the ground up. Many are now working on next-gen EVs built on new platforms. Ford, for example, is introducing an entirely new manufacturing process to support production of a smaller, more affordable electric truck.

GM, meantime, is preparing to relaunch the mass market-oriented Chevy Bolt, and Rivian is slated to debut its more-affordable R2 lineup next year, among other upcoming launches.

As McDonald sees it, the US’s first EV phase was defined by products that didn’t match what mainstream consumers were looking for. Automakers found some success, to be sure—Rivian’s R1S in the luxury segment, for example. And half of the Cadillac brand’s sales are now electric.

But the next EV era, McDonald said, must feature mass-market EVs with lower price tags and better software experiences.

“If you get the car right, and it’s a fit with the market, and you price it correctly, there’s solid demand and market for it,” McDonald said. “We just don’t have enough of those vehicles yet. And that’s the problem—not EVs.”