With the loss of the $7,500 Electric Vehicle Tax Credit, it looks as if Tesla CEO Elon Musk was right all along.<\/p>\n
As the tax credit\u2019s loss starts to take effect, car companies that have long relied on the $7,500 credit to create sales for themselves are starting to adjust their strategies for sales and their overall transition to electrification.<\/p>\n
On Tuesday, General Motors announced<\/a> it would include a $1.6 billion charge in its upcoming quarterly earnings results from its EV investments.<\/p>\n Ford said in late September that it expects demand for its EVs to be cut in half. Stellantis is abandoning its plan to have only EVs being produced in Europe by 2030, and Chrysler, a brand under the Stellantis umbrella, is bailing on lofty EV sales targets here in the U.S.<\/p>\n How Tesla could benefit from the \u2018Big Beautiful Bill\u2019 that axes EV subsidies<\/a><\/p>\n<\/blockquote>\n The tax credit and EV subsidies have achieved what many of us believed they were doing: masking car companies from the truth about their EV demand. Simply put, their products are not priced attractively enough for what they offer, and there is no true advantage to buying EVs developed by legacy companies.<\/p>\n These tax credits have helped companies simply compete with Tesla, nothing more and nothing less. Without them, their products likely would not have done as well as they have. That\u2019s why these companies are now suddenly backtracking.<\/p>\n It\u2019s something Elon Musk has said all along.<\/p>\n Back in January, during the Q4 and Full Year 2024 Earnings Call, Musk said:<\/p>\n \u201cI think it would be devastating for our competitors and for Tesla slightly. But, long term, it probably actually helps Tesla, that would be my guess.\u201d<\/p>\n In July of last year<\/a>, Musk said on X:<\/p>\n \u201cTake away all the subsidies. It will only help Tesla.\u201d<\/p>\n Take away the subsidies. It will only help Tesla.<\/p>\n Also, remove subsidies from all industries!<\/p>\n \u2014 Elon Musk (@elonmusk) July 16, 2024<\/a><\/p>\n<\/blockquote>\n Over the past few years, Tesla has started to lose its market share in the U.S., mostly because more companies have entered the EV manufacturing market and more models are being offered.<\/p>\n Nobody has been able to make a sizeable dent in what Tesla has done, and although its market share has gotten smaller, it still holds nearly half of all EV sales in the U.S.<\/p>\n Tesla\u2019s EV Market Share in the U.S. By Year<\/p>\n As others are adjusting to what they believe will be tempered demand for their EVs, Tesla has just reported its strongest quarter in company history, with just shy of half a million deliveries.<\/p>\n Will Tesla thrive without the EV tax credit? Five reasons why they might<\/a><\/p>\n<\/blockquote>\n Although Tesla benefited from the EV tax credit, particularly last quarter, some believe it will have a small impact since it has been lost<\/a>. The company has many other focuses, with its main priority appearing to be autonomy and AI.<\/p>\n One thing is for sure: Musk was right.<\/p>\n \t\t\t\t\t\t\t\t\t\t\t\t\t\n
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