How One Line In A Trump Trade Deal Could Transform America's EV Market

Shared standards between the U.S. and Europe could just open the floodgates for cheaper EVs on our shores. Here's how.

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Kevin Williams

By: Kevin Williams

Aug 26, 2025 at 3:57pm ET

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A new framework for trade between the EU and U.S. proposes uniting vehicle regulatory standards between the two.
Some European experts claim the two standards aren't compatible since Europe is so pedestrian-focused, and thus big trucks would still be wildly inappropriate for European roads.
It could make a way for cheaper, smaller EVs, though.

It’s no secret that the Trump Administration has thrown the global auto markets into turmoil. Slapdash and ill-advised methods of trying to stymie the advancement of Chinese automakers, all while re-shoring jobs via the willy-nilly application of arbitrary tariffs, have only made things pretty tense for anyone running a big business.

No doubt, the world is getting tired of unpredictable back and forth; they’re all trying to figure out a way to re-establish the status quo before everyone goes broke. But what if a new deal leads to cheaper electric vehicles finally making their way to our shores?

The European Union and the United States are working on a new trade agreement, and one of the biggest bombshells in the framework is something that’s never been done: uniting the vehicle regulatory standards between the two entities.

That’s a pretty big deal, one likely pressed on by the U.S., since low sales of American-made large trucks overseas have become a huge sticking point and sound bite for international relations for the White House.

As initially reported by Automotive News, some experts say that this won’t actually be the big win that the U.S. thinks. There are plenty of reasons why people in Europe don’t really want big American trucks, and it’s not really because of tariffs. The trucks are large and expensive; most Europeans can’t really afford them (hell, most Americans can only do so with dangerously stretched-out loan terms), let alone fuel them up. and they’re a chore to drive and use in most European locales.

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But I do think that this union could bring a renaissance of smaller, cheaper cars. Just hear me out.

The U.S. crash and federalization standards can be complicated to meet, especially for smaller or cheaper cars. There’s a reason why US-market vehicles have had alterations to the structure or design in order for U.S. sale; just consider the now-departed Honda Fit, which had a huge nose extension for our market just to go on sale.

For a lot of manufacturers, meeting regulations can be a kiss of death. Lots of times, these alterations are significant engineering changes that cost a lot of money to do, and certify for our market. That’s part of the reason why some of the good small cars over the years have been left behind in Europe. Removing this barrier could make sales easier. Especially for electric vehicles, which generally won’t have to meet any emissions standards like an ICE vehicle would.

This may just be wishful thinking, though. Some European experts aren’t keen on the unification of standards, since they say that European standards are more biased toward pedestrian protection, and ma be fundamentally incompatible with what we have in the United States. The large pickup trucks with square, huge noses have lots of rightful criticism here for how they are completely unsafe for pedestrians. In Europe, they’re basically a non-starter.

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Plus, you have the other obstacles: tariffs on foreign-made cars, for one, or restrictions against China-sourced batteries. Some of the European EV supply chain is evolving to move away from dependence on China on its own, however, so perhaps that'd be less of an issue long-term.

Then again, it’s not clear if the U.S.-EU trade agreement will go through, or if it will include this unification in its final form. As of right now, the White House’s official statement says that it intends to “With respect to automobiles, the United States and the European Union intend to accept and provide mutual recognition to each other’s standards,” and that “Cooperation on standards plays a crucial role in enhancing the transatlantic marketplace.”

What that would look like for either side remains to be seen. Just like the idea of re-shoring jobs or effectively ending the United States-Mexico-Canada Agreement, it will take a lot of time and money to unite the two sides under one roof. That is, if it even happens, since the Trump Administration thus far hasn’t been exactly known for its ability to stick to promises, especially when it comes to international relations.

What do you think?

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If they do, though, perhaps the concept of me daily driving a Renault 5 in Ohio won’t just be a pipe dream.

Contact the author: Kevin.Williams@insideevs.com

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