Tesla CEO Elon Musk has reacted with fury to reports that California Governor Gavin Newsom could exclude his company from a state-funded electric vehicle tax credit program.
According to Reuters, President-elect Donald Trump's incoming administration plans to scrap a $7,500 consumer tax credit for electric vehicles introduced by President Joe Biden's administration as part of its Inflation Reduction Act.
On Monday, Newsom announced that if the federal subsidy is eliminated, he will revive California's Clean Vehicle Rebate Project, which provided its own tax credits for electric vehicles before being phased out in 2023.
After Bloomberg News reported that Tesla could be excluded because of market-share limitations, Musk responded on the social media platform he owns—X, formerly Twitter: "Even though Tesla is the only company who manufactures their EVs in California! This is insane."
In his announcement, Newsom said: "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. 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."
Newsweek contacted Tesla's press office, Newsom and Trump's presidential transition team for comment via email outside regular office hours.
The Bloomberg report also sparked a response from House Republican Ro Khanna, who represents California's 17th Congressional District. In a post on X, which Musk shared, Khanna wrote: "Tesla makes over 550,000 vehicles in Fremont in my district & employs over 20,000. Let's not play politics with keeping manufacturing in California. It would be foolish to exclude Tesla. Have we learned nothing from snubbing @elonmusk at the Biden EV summit?"
Craig Lawrence, a partner at Energy Transition Ventures in Texas, wrote: "FFS @GavinNewsom stop it. You think you can beat @elonmusk. You can not. Celebrate Tesla as a massive California win and quit chasing them out of the state."
DogeDesigner, a popular cryptocurrency-focused account with 1 million followers on X, said: "This is pure lawfare against Elon Musk. It's time to revoke Gavin Newsom as governor."
Other social media users supported Newsom's reported move to exclude Tesla.
On Bluesky, Tim Fullerton, who worked in the Interior Department during President Barack Obama's administration, wrote: "Gavin Newsom has proposed a state electric vehicle tax credit. The hilarious thing? It excludes Tesla." After three laughing emoji, he added, "More Dems need to fight like this."
In July, Musk, a prominent Trump supporter whom the president-elect selected to co-lead the newly created Department of Government Efficiency, said he supported the removal of federal electric vehicle subsidies.
On X, Musk wrote: "Take away the subsidies. It will only help Tesla. Also, remove subsidies from all industries!"
Musk also said the elimination of tax credits would be only slightly bad for his company and in the long term "probably actually helps Tesla."
In 2021, Musk announced that Tesla was moving its headquarters from California to Texas. The billionaire had previously clashed with Newsom over the shelter-in-place order the governor introduced because of the coronavirus pandemic. During Tesla's April 2020 first-quarter earnings call, Musk described the order as fascist and said it was causing "great harm" to the industry.
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