California Proposes $200 Million EV Incentive Program
California Governor Gavin Newsom has proposed a $200 million state investment to support electric vehicle (EV) adoption as part of his January budget proposal, following the expiration of the federal EV tax credit.
According to the proposal and subsequent media coverage, the funding would establish a new light-duty zero-emission vehicle (ZEV) incentive program for electric cars, trucks, and SUVs. The Administration has also indicated it plans to pursue statutory changes intended to strengthen California’s ZEV market and sustain adoption momentum.
California remains the largest EV market in the United States. Just before federal incentives expired in late 2025, zero-emission vehicles accounted for 29.1 percent of all new vehicle sales in the state, underscoring California’s outsized role in national EV trends.
Media coverage
The proposal has been widely covered by California and national outlets, including ABC10 News. In its reporting, ABC10 quoted Mike Murphy, founder of EVs for All America, who highlighted the proposal’s significance for consumers and U.S. auto manufacturing as states take on a larger role in EV policy.
The budget proposal will now move through legislative negotiations, with lawmakers expected to finalize a revised budget later this spring. State agencies would then be responsible for developing program details, including eligibility, incentive levels, and timing.
Related research
EVs for All America partnered with Atlas Public Policy to examine how state EV incentives can deliver the greatest impact for consumers and taxpayers. The research finds that first-time buyer, point-of-sale incentives are especially effective, and that supporting both new and used EVs helps expand access while growing the overall EV market.
Read the Atlas Public Policy Report: The Opportunity for New Incentives and Benefits of a First-Time EV Buyer in California
ABC10: “Newsom proposes $200M EV incentive for California drivers“
USA Today: “California wants to give EV rebates to car buyers. Here’s why”
Bloomberg: “Newsom Seeks $200 Million to Replace EV Tax Credits Cut by Trump”
Reuters: “California governor proposes $200 million in new state EV tax rebates”