Trump Team Moves to End Biden's Electric Vehicle Tax Cut

18 November 2024, 12:54

Tesla has historically been the largest beneficiary of consumer subsidies for electric vehicles passed by Biden and previous administrations

Trump Team Moves to End Biden's Electric Vehicle Tax Cut

Eliminating the tax credit could have major consequences for the already stalled U.S. transition to electric vehicles. Still, representatives from Tesla — by far the country's largest electric vehicle maker — told Trump's transition committee they support eliminating the subsidy, said two sources who spoke on condition of anonymity.

“Removing the subsidy means that competitors will not be able to catch up and will not be able to compete on costs.” , Mersch said.

Musk and Tesla could also benefit hugely from Biden policies that Trump is likely to keep in place or strengthen, such as tough trade barriers blocking imports of Chinese electric vehicles, including 100 -percent duty.

Chinese electric vehicle makers, led by Tesla rival BYD, have rapidly overtaken the rest of the industry with the help of generous government subsidies. Electric vehicles and hybrids have accounted for more than half of all vehicles sold in recent months in China, the world's largest auto market.

Tesla is a major player in the Chinese market but, like all foreign automakers, has been losing market share recently in favor of local players who sell electric cars for as little as $10,000.

Mersch said Tesla "can't beat Chinese electric cars," but with Trump's help, it may be able to keep them out of the U.S. market.