FYI: Tesla CEO Elon Musk reacts to former President Donald Trump’s pledge to dismantle the Biden administration’s “EV mandate” on his first day in office.
—
Tesla CEO Elon Musk expressed his views after former US President Donald Trump vowed to eliminate the Biden administration’s electric vehicle (EV) mandate immediately upon taking office. Musk’s remarks suggest that Tesla is confident in its ability to thrive without relying on specific EV subsidies.
### The Intersection of Politics and Electric Vehicles
Electric vehicles have become a hot-button issue, emblematic of the broader political divide. While Tesla stands as the leading EV manufacturer in the US, it’s been notably overlooked by the Biden administration, partly because of its non-unionized workforce. Former President Trump has seized upon this, positioning himself as staunchly against the EV mandate. At the Republican National Convention, he claimed, “I will end the Electric Vehicle Mandate on Day One — thereby saving the US auto industry from complete obliteration and saving US customers thousands of dollars per car.”
### Musk’s Confident Response
In light of Trump’s declarations, Tesla and EV enthusiasts quickly turned to social media, querying Musk on his stance. Musk, unfazed by Trump’s statements, reaffirmed that Tesla doesn’t need subsidies to succeed. “A surprising number of people think that Tesla survives on subsidies. That is true of our competitors, but not of Tesla,” Musk tweeted.
### Tesla’s Track Record of Independence
Tesla’s profitability history backs up Musk’s assertions. The company reached a significant milestone by phasing out the $7,500 US EV federal tax credit in July 2018 after delivering its 200,000th vehicle. By 2020, Tesla’s cars were sold without any federal tax credits, yet they still achieved full-year profitability, posting $862 million in net profits.
### The Inflation Reduction Act’s Impacts
In August 2022, President Biden signed the Inflation Reduction Act (IRA), which reinstated federal subsidies for qualified Tesla vehicles. Nevertheless, by this time, Tesla was already a profitable entity, and the Model Y was hitting the streets. This underscores Musk’s point that Tesla can prosper independently of federal tax credits.
### Conclusion
Musk’s nonchalant reaction to Trump’s promise to end the EV mandate highlights Tesla’s confidence in its business model. Moreover, Tesla’s ability to achieve profitability without subsidies reinforces Musk’s claims. As the political landscape continues to shift, the resilience and strategy of companies like Tesla remain essential for the future of electric vehicles.
—
For more insights and updates, don’t hesitate to reach out to us at tips@automotive.fyi. To stay updated with the latest in the automotive world, visit our website at Automotive.fyi.
By William Kouch, Editor of Electric Vehicles, automotive.fyi
