California could exclude Tesla from new EV tax rebates if Trump scraps the federal credit
Tit for tat… California Gov. Gavin Newsom plans to offer electric-vehicle rebates in the Golden State if POTUS-elect Trump scraps the federal EV tax credit — but said Teslas likely wouldn’t be eligible for the incentive. Tesla stock sank after word that its cars might be excluded. Trump’s reportedly considering ditching Uncle Sam’s tax credit of up to $7.5K for EV buyers, and his staunch ally Elon Musk has suggested he supports the plan. If Trump goes through with it, Newsom said he’d try to institute rebates to incentivize Californians to buy electric cars (just not Teslas).
The reasoning: Newsom’s office cited efforts to encourage competition in the EV market as the reason Tesla (and potentially others) may be left out of the program.
Petty cash: Musk called Newsom’s move “insane,” saying that Tesla is the only company that manufactures EVs in California.
Electric beef… Newsom has set ambitious targets to tackle the climate crisis, and Trump threatens to derail those goals. Trump has said that he would end California’s plan to ban the sale of new gas-powered cars by 2035. In his first term, Trump eliminated CA’s power to set its own standards on air pollution (the Biden admin restored that ability). Trump also loosened federal environmental regs and removed the US from the Paris climate agreement. Musk was a driving force behind making EVs mainstream, but appears to have toned down his climate ambitions since allying himself with Trump.
The electric transition needs help… The shift to clean energy is slow going and needs all the juice it can get. Tesla, America’s biggest EV seller, accounted for over half of new electric-car sales in California last quarter. By excluding the biggest player from its incentive program, the state may be doing a disservice to its own environmental goals. Still, there’s speculation that Musk supports ending EV tax credits because it could help Tesla stay in the lead.