US President Donald Trump has signed legislation that repeals California's electric vehicle (EV) mandate.

This move terminates the waiver granted by the Biden administration's Environmental Protection Agency (EPA) that allowed California to enforce its own emissions standards.

The California mandate aimed to increase the percentage of zero-emission cars from 35% in 2026 to 100% by 2035. Eleven other states had aligned with California's EV mandate.

Trump statement as reported by FOX Business: "This is really something and it has to do with the California auto regulation CRA. It's been a disaster for this country. And I want to thank everybody for being here. We officially rescue the US auto industry from destruction by terminating the California electric vehicle mandate once and for all.

"They passed these crazy rules in California and what it would be 17 states would go by them. And automakers didn't know what to do because they're really building cars for two countries – when you have 17 states, you're building cars for two countries."

Despite the repeal, Tesla CEO Elon Musk expressed confidence in his company's ability to compete. "As long as it's happening to everybody, I'll be able to compete.”

The stock market showed mixed reactions following the announcement. Tesla shares initially rose by 1.3% but later fell by 0.3%. Rivian shares decreased by over 1.3%.

Other major automakers, including General Motors, Stellantis, and Ford, also experienced declines in their share prices, with decreases of nearly 1.5%, 1.8%, and 1.6%, respectively.

A prominent auto industry trade group, representing Detroit's Big Three—Ford, General Motors, and Stellantis—along with other leading automakers, welcomed the decision to repeal the California EV standard.

The group praised the move as beneficial for the industry.

Automotive Innovation Alliance president and CEO John Bozzella said: "Everyone agreed these EV sales mandates were never achievable and wildly unrealistic. Worse than unachievable – these EV mandates were going to be harmful. Harmful to auto affordability, to consumer choice, to industry competitiveness and to economic activity."

He added: "Customers don't want the government telling them what kind of car to buy. What they want is a range of choices like efficient gas-powered, battery-electric, hybrid and plug-in hybrid vehicles.”