Navigating Transportation and Infrastructure Changes
Summary
President Trump's plans for infrastructure and transportation were not particularly detailed throughout the campaign. Yet, based on his actions throughout his first term, his transportation policy is poised to reduce federal spending, promote private investment, and prioritize traditional infrastructure projects like roads and bridges. Conversely, projects with environmental and sustainability goals, like public transit, bike and walking trails, and Electric Vehicle (EV) incentives, may be deprioritized. Additionally, Trump’s approach includes regulatory reform on everything from fuel-efficiency standards to permits to consumer protections.
Key Takeaways
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Cutting costs and reducing the size of the federal government will be a priority for the Trump administration.
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Federal infrastructure funding will continue, but the Trump administration may claim credit for many of the projects started under the Biden administration.
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Less focus on energy-efficient transportation projects.
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The Trump administration will reduce regulations on big businesses and look to reduce some of the consumer protection politics of the Biden administration.
Policy Considerations
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The Trump administration has signaled that it will slash fuel-efficiency requirements for new cars and light trunks and reverse the vehicle emissions standards, a rule by the Environmental Protection Standards to reduce carbon dioxide from tailpipe emissions.
Trump has clarified that he will rescind the $7,500 tax credit for EV purchases as part of his ongoing promise to move away from clean energy. However, it remains to be seen how Elon Musk influences Trump's policies around E.V. with the balance of pushing against China’s dominance in the electric vehicle market. This will be something to watch in the future.
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The bipartisan infrastructure law provided over $7.5 billion to states to increase their electric charging capacity. President Trump has criticized this program, and it remains to be seen if the remaining funds will be given to the states. If the federal government severely curtails funding, the private sector may have to support the expansion of electric vehicle charging stations.
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A significant focus of Trump's second administration will be tariffs on all non-American goods. This will impact the automotive industry as he tries to shift production to U.S. manufacturing and away from Chinese-manufactured vehicles.
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Trump's proposed autonomous vehicles (AVs) policies focus on creating a federal framework to expedite development and deployment. This includes establishing clear regulations to increase the number of AVs manufacturers can deploy annually, potentially raising the current limit from 2,500 to 100,000 vehicles. The goal is to accelerate the integration of AVs into the market, emphasizing their importance for the future of transportation and technology sectors.
Additionally, Trump’s administration plans to prioritize AV-related laws and regulatory guidelines through the U.S. Department of Transportation to support companies like Tesla, Waymo, and others in scaling their AV technologies. This policy direction could significantly enhance the growth of the AV industry by providing a more conducive regulatory environment for innovation and deployment.
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Biden loved Amtrak, and his administration proposed billions for its continued expansion across the USA, while Trump favors funding for roads and highways. During his first administration, he proposed reducing funding for Amtrak. It remains to be seen if he will continue any of the Biden administration's funding for rail. However, one should not expect increased funding for rail in the next four years.
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During Trump's first presidency, more restrictive policies regarding travel visas from certain countries impacted tourism. Industry experts are unsure how this new administration will implement visa policies and whether it will continue Biden’s administration's efforts to reduce visa wait times.
Biden’s administration pursued aggressive consumer protections for airline travelers, requiring airlines to pay passengers in cash and cover accommodations for passengers affected by cancellations to increase safety standards. Many of these rules could be undone by the incoming Trump administration or challenged in court. The heads of many top airline companies, unhappy with some of the consumer-friendly policies, have praised the new administration, expecting it to be more business-friendly.
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The Biden administration sent billions to airports across the US. Philadelphia International Airport received $27.4 million and has used these funds to upgrade terminals while other smaller airports also benefited. During Trump’s first term, he prioritized airport upgrades but failed to pass any significant funding. There may be an opportunity for continued funding for airport modernization under the Trump administration in high-trafficked airports.
Impact on Pennsylvania and Philadelphia
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During the Biden administration, billions of dollars went towards transportation and infrastructure improvements. This amount of funding will not continue, and we expect significant cuts to public transportation funding. PA will need to continue to explore funding opportunities at the state level for public and private transportation. For example, the state should not expect the federal government to help with SEPTA funding . Of note, there is hope that federal funding through the Consolidated Rail Infrastructure and Safety Improvements grant program for the restoration of rail service between New York City and Scranton will not be impacted by the Trump administration; however, that still needs to be seen.
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PA received $171.5 million from the $5 billion National Electric Vehicle Infrastructure (NEVI) Formula Program, and the department has awarded $59 million in total funds across the Commonwealth in 43 counties. The potential cessation of federal support may hinder the expansion of these projects. Philadelphia and other counties have proactively promoted and expanded EV adoption laws. Local governments will need to continue to invest in EV programs and not depend on federal funding for expansion.
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President-elect Trump has expressed strong support for AV’s and business-friendly regulations.
Pittsburgh's status as a hub for major AV companies like Argo AI and Aurora, along with significant research efforts from institutions like Carnegie Mellon University, positions it to attract funds and attention from the Trump administration.
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