California Governor Gavin Newsom is doubling down on his administration's plan to ban the sale of new gasoline-powered vehicles by 2035, asserting the policy is "good public policy" despite widespread public opposition. A recent poll indicated that nearly 66% of California adults and likely voters disapprove of the executive order signed in 2020. This skepticism spans across political lines, with half of all Democrats expressing disapproval of the mandate.
Newsom announced new incentives for electric vehicle (EV) purchases during a press conference, aiming to encourage adoption of cleaner transportation alternatives. The state is now offering "instant rebates" of $3,500 for first-time buyers of new EVs and $1,750 for used EVs. These discounts are funded by $135.5 million in state funds, supplemented by matching contributions from participating automakers, including Hyundai, Lucid, and Tesla. Ford, Rivian, Chevrolet, and Kia are slated to join the rebate program this month, with Toyota, Lexus, Honda, Subaru, and Mitsubishi following in subsequent months.
During the announcement, Newsom contrasted California's approach with that of former President Donald Trump, stating, "While Donald Trump is hellbent on burning more expensive fossil fuels and raising costs for Americans, California is proving there’s a better way." The 2020 mandate to ban new gas-powered vehicle sales has faced attempts by Trump and Congressional Republicans to undermine federal waivers that enable California's climate regulations.
Newsom suggested that persistently high gas prices in California, which have hovered near $6 per gallon, could serve as a catalyst for residents to consider electric vehicles. He remarked, "So more and more people, I imagine if you polled them today, they have a very different opinion than they did even a few months ago."
The funding for the EV rebates originates from California's cap-and-invest program, previously known as cap-and-trade. This program, which sets emissions limits and allows industries to purchase emission credits, generates an estimated $7 billion to $8 billion annually, according to Net-Zero California. Proceeds from this program are allocated to climate initiatives. However, the cap-and-invest program has also faced criticism for its contribution to California's high gasoline prices, with estimates suggesting it added approximately 23 cents to the cost of a typical gallon of gas as of May 2026.