Elon Musk has announced his support to Donald Trump’s VP pick, Senator JD Vance. It’s hard to believe, considering Vance is pushing a bill that would crush Tesla’s sales in the US.
As we often reported in recent months, Musk is no stranger to acting against the interest of Tesla shareholders despite his fiduciary duties as CEO.
One of those cases, his threat not to build AI products at Tesla if he doesn’t get 25% control of the company, is now going to court.
But now, the CEO is making a move that could even more clearly be against Tesla shareholders and Tesla’s mission to accelerate the advent of clean energy.
Last week, there was a report that Musk donated to a PAC financing Trump’s campaign.
We were waiting for the PAC to disclose its donors today to confirm it, which despite Musk clearly getting closer to Trump in the last few months, would have been the first official support from Tesla’s CEO to the former president.
However, we didn’t have to wait as Musk decided to “fully endorse” Trump following the assassination attempt on Saturday.
The Tesla CEO has yet to explain why he is endorsing Trump:
Today, Trump announced that he picked JD Vance as his VP and Musk quickly congratulated him and gave his support to the decision:
Vance is a US Senator from Ohio who once was a critic of Trump, but like many, he changed his tune as the former president strengthened his grip on the GOP. He has since become one of the most prominent Trump loyalists.
Like his change of view on Trump, Vance also changed his view on Tesla’s mission. He once was a proponent of renewable energy, but he has since changed his tune.
More recently, he even introduced a bill that would crush Tesla’s sales in the US.
Vance is behind the ‘Drive American Act‘, which not only would remove the incentives to buy battery-electric vehicles (BEV and PHEV), but it replace it with an equivalent $7,500 incentive to buy American-made fossil fuel-powered vehicles (ICE and HEV):
Senator JD Vance (R-OH) has introduced the Drive American Act, which would eliminate over $100 billion in existing electric vehicle (EV) subsidies and replace them with the America First Vehicle Credit to promote gas-powered vehicles made in the United States. As Senator Vance has repeatedly pointed out, the Biden administration’s existing EV subsidies penalize UAW workers who build popular, gas-powered vehicles and the American consumers who wish to buy them.
Tesla’s stock erased 2% worth of gains following the VP pick announcement and Musk’s support.
Electrek’s Take
Top comment by ChiefHeyoka
Long time reader of this blog.
We sold our Model 3 to buy a Model X. We’re RIVN shareholders.
I’m glad to see Fred writing about this. But it doesn’t go far enough. Project 2025 not only calls for an end to EV subsidies. It sort of demonizes them, indicates they’re a threat to car companies. It’s fealty to the oil and gas industry.
Elon has stated, albeit years ago, that the environment and renewables were Tesla’s mission. By backing Trump it seems that’s all out the window now.
It also is in conflict with the algorithm, written about in Walter Isaacson’s book.
Can anyone please explain why Elon falling solidly in line with Trump makes sense?
If we needed more proof that Elon is actively working against Tesla’s interest this is it.
Now, I can understand removing the EV tax credit. I don’t think it would be good for Tesla or the mission, but there are at least arguments against the government financing EV purchases.
Personally, I always believed that a carbon tax is the right approach as instead of incentivizing EV sales directly, you represent the actual cost of the environment in the cost of fossil fuel-powered vehicles.
But Vance is not going in that direction at all. Instead, he wants to subsidize fuel-powered vehicle sales – making EVs, including Tesla’s, even less competitive in the market. That’s madness, and it would undoubtedly negatively affect Tesla’s sales in the US, which is its second most important market after China.
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