Summary
- California Governor Gavin Newsom plans to revive state EV subsidies if the federal EV tax credit is removed
- There is speculation that the revived California EV rebate may exclude Tesla vehicles
- Reasons for this exclusion could include Elon Musk’s role in cutting the federal tax credit and Tesla’s move to Texas
- Tesla’s exclusion could impact EV sales and punish consumers who prefer Tesla vehicles
- Other possibilities for excluding Tesla from incentives include encouraging automakers to produce more EVs, or supporting companies with strong ESG policies
Article
The article discusses California Governor Gavin Newsom’s plan to revive the state’s EV subsidies if the federal $7,500 US EV tax credit is eliminated by the Trump administration. However, an interesting aspect of this plan is that it may exclude Tesla vehicles. The exclusion of Tesla could be seen as a response to Elon Musk’s criticisms of California, Democrats, and his relocation of Tesla’s headquarters to Texas. Despite these tensions, Tesla plays a significant role in the California economy and supporting the company means supporting jobs in the state, particularly around its Fremont factory.
On the other hand, excluding Tesla from EV incentives could also be seen as a way to encourage a more diverse EV market, as Tesla currently dominates the market with approximately half of all electric vehicle sales in the state. By excluding Tesla, the state could incentivize other automakers to increase their production and sales of electric vehicles. Another possible reason for excluding Tesla could be related to the company’s environmental, social, and governance (ESG) or diversity, equity, and inclusion (DEI) policies – although this is considered a less likely scenario.
Furthermore, the state may choose to restrict incentives to electric vehicles below a certain price point, which could potentially exclude Tesla vehicles due to their higher price range. However, this would also limit the number of electric vehicles that qualify for incentives. The state could also potentially disqualify automakers who actively lobbied against the federal EV tax credit, although this is considered unlikely. Despite these possibilities, it remains to be seen whether Tesla vehicles will actually be excluded from California’s revived EV subsidies.
In the event that Tesla vehicles are excluded from the incentives, it is speculated that the state may implement a policy that encourages automakers to increase the share of electric vehicle sales in their portfolio, thereby penalizing companies already at 100% electric sales. This approach could push automakers to further accelerate their transition to electric vehicles and reduce their reliance on gasoline-powered cars. Ultimately, the decision to exclude Tesla from California’s EV subsidies would have implications for the state’s EV market and the overall efforts to promote clean transportation.
Read the full article here
