Construction spending on manufacturing began to soar. Well over $100 billion worth of EV assembly facilities, solar-panel factories, battery recycling plants, and more have been announced since the passage of the law, which created tax incentives as well as grant and loan programs for domestic clean-energy manufacturing.
But now, under President Trump, the trend has started to go in reverse.
Construction spending on factories has plateaued. Firms are pausing and scaling down investment plans. Others are outright canceling projects due to Trump’s policies: Take Prysmian Group, for example, which earlier this year scrapped its plan to build a $300 million offshore wind cable manufacturing facility at the site of a retired coal plant in Somerset, Massachusetts. For the first time since E2 began tracking the data in 2022, canceled investments in cleantech manufacturing outweigh new investments, and it’s not particularly close.
There are still some new investments happening: $1.7 billion worth in March alone, per E2, including a $200 million Tesla grid-battery factory in Texas. Plus, the vast majority of announced projects have yet to be canceled, paused, or downsized.
But the going is not guaranteed to get any easier.
Trump’s tariffs are causing pain across the U.S. manufacturing sector in general. In an early April survey conducted by the Philadelphia Fed, manufacturers expected new orders to fall sharply over the next six months. And if congressional Republicans decide to rescind the Inflation Reduction Act’s manufacturing incentives, a move that’s on the table, the situation could grow even more dire.
