Over the past several years, Elon Musk’s Tesla Cybertrucks have become a cultural phenomenon with many star athletes and celebrities embracing the futuristic-looking vehicles. However, it sounds like California Gov. Gavin Newsom is considering a move that could be detrimental to Musk and Tesla.
The Donald Trump administration promised to cut the federal electric-vehicle tax credit which gives a $7,500 federal tax credit to those who purchase a zero-emission vehicle.
If that happens, California Gov. Gavin Newsom said that the state would offer its own rebate in place of the federal one.
“We will intervene if the Trump Administration eliminates the federal tax credit, doubling down on our commitment to clean air and green jobs in California,” Newsom said in a statement according to Business Insider. “We’re not turning back on a clean transportation future — we’re going to make it more affordable for people to drive vehicles that don’t pollute.”
While this sounds like good news for Musk and Tesla, there’s one big problem: that rebate will likely exclude Tesla.
Newsom’s office confirmed to Business Insider that the state’s proposed rebate program would likely include a market-share cap.
A market-share cap would exclude companies whose sales account for a certain number of total electric vehicle sales. Since Tesla is the top-selling electric vehicle manufacturer in the state, it would almost certainly be excluded from the rebate if the state does indeed include a market-share cap.
The purpose of a market-share cap like this is to promote competition and help up-and-coming electric vehicle companies enter the market.
However, it would obviously be bad news for Tesla as it would give their competitors an advantage.
We’ll have to see whether or not this plan materializes, but this obviously would not be very good news for Musk.
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