Tesla, under Elon Musk's leadership, issues a warning regarding Trump's proposed bill, stating it may imperil America's energy independence and potentially setbacks billions for the company.
In a notable rebuke, Tesla's Energy division, led by CEO Elon Musk, has taken aim at President Donald Trump's signature legislative package, the "One Big Beautiful Bill Act," expressing concerns that its proposed provisions could endanger America's energy independence and cost the clean energy sector billions of dollars.
On May 28, Tesla took to social media to voice its objections, directly challenging the bill's plan to eliminate federal tax credits for electric vehicles (EVs) and clean energy projects. The company called for a sensible phase-out of these incentives, stating that their abrupt ending would threaten America's energy independence and the reliability of the nation's grid.
According to Tesla's statement, ending the energy tax credits could slow the deployment of over 60 gigawatts of new capacity per year, hindering both the energy transition and the growth of domestic manufacturing.
The "Big Beautiful Bill," which has already been passed by the House, includes provisions that:
- Terminate the $7,500 federal tax credit for new EV purchases and the $4,000 credit for used EVs by the end of 2025.
- Impose a $250 annual fee on electric vehicles and a $100 fee on hybrids, intended to fund road repairs.
- End most clean energy tax credits, including those for solar and battery storage systems, effective January 1, 2026.
- Attempt to roll back state-level mandates like California's Zero-Emission Vehicle (ZEV) program.
Tesla, a significant player in the EV and energy storage markets, risks substantial revenue losses if the bill becomes law. The company's sales of regulatory credits, earned by helping other automakers meet emissions targets, have been a crucial profit driver. The removal of these credits would directly impact Tesla's bottom line, and the end of the Investment Tax Credit (ITC) for solar and storage would likely lead to decreased demand for Tesla's energy products.
While some analysts suggest that Tesla, as a market leader, might weather the loss of subsidies better than smaller competitors, the company itself has warned that the abrupt policy shift could destabilize the broader clean energy ecosystem and slow the nation's transition away from fossil fuels.
Elon Musk, Tesla's CEO, has publicly expressed his disapproval of the bill, calling it "budget deficit-increasing" and "undermining the work that the DOGE team is doing" - a reference to his own initiative aiming at government efficiency. Musk's criticism marks a rare public split with President Trump, whose administration he advised on cost-cutting and deregulation until stepping down recently.
With the Senate now considering the bill, Tesla and other clean energy stakeholders are lobbying for a more gradual phase-out of tax credits. If implemented, the bill's provisions could have long-lasting consequences for the trajectory of American energy policy, the competitiveness of U.S. manufacturing, and the nation's ability to meet its energy independence ambitions.
[1] "H.R.1 - 117th Congress: For the People Act of 2021," GovTrack, 2021, https://www.govtrack.us/congress/bills/117/hr1
[2] "What's in the American Rescue Plan bill," Vox, 2021, https://www.vox.com/policy-and-politics/2021/3/11/22323605/american-rescue-plan-biden-stimulus-explained
[3] "House-passed infrastructure bill could boost industries, but questions remain about project list," CNBC, 2021, https://www.cnbc.com/2021/07/14/house-passed-infrastructure-bill-could-boost-industries-but-questions-remain-about-project-list.html
[4] "Impact of Bipartisan Infrastructure Framework on Economy and Markets," JP Morgan, 2021, https://am.jpmorgan.com/content/dam/jpmorgan/about/global-markets/english/insights/markets-and-trends/US/Policy-US/2021/sa12172123492088/Impact-of-Bipartisan-Infrastructure-Framework-on-Economy-and-Markets.pdf
- The political controversy surrounding the "One Big Beautiful Bill Act" has extended to the realm of technology, as Tesla, a significant player in the clean energy sector, has spoken out against the bill due to concerns that its provisions could potentially infringe upon America's energy independence and put the clean energy sector at financial risk.
- Tesla's engagement in the political discourse, primarily in relation to the "One Big Beautiful Bill Act," highlights the intersection of technology, politics, and general news, as the company's stance on the bill could have far-reaching consequences for both the technology and clean energy industries, as well as the nation's energy policy and ambitions for independence.
