American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Business

Tesla excluded from California’s proposed EV buyer incentive program, stock drops: ‘This is insane’

by admin November 26, 2024
November 26, 2024
Tesla excluded from California’s proposed EV buyer incentive program, stock drops: ‘This is insane’

California Governor Gavin Newsom has unveiled a controversial plan to provide state rebates to electric vehicle (EV) buyers, effectively excluding Tesla Inc. from the program.

The decision pits Newsom, a potential Democratic presidential contender, against Tesla CEO Elon Musk, a prominent Republican ally and key figure in President-elect Donald Trump’s transition team.

Newsom’s initiative, announced Monday, seeks to reboot a rebate program that California phased out in 2023 if Trump repeals the federal $7,500 EV tax credit.

But Newsom’s proposal would also “include changes to promote innovation and competition in the ZEV market,” a line that suggests the state would try to limit the credits to smaller market shares than Tesla.

“It’s about creating the market conditions for more of these car makers to take root,” Newsom’s office told Bloomberg News, adding that the details are subject to legislative negotiations.

Musk reacted to the news on X.

“Even though Tesla is the only company who manufactures their EVs in California! This is insane,” he said.

Tesla’s stock fell 2.9% in New York trading following the news.

Exclusion of Tesla stirs political and market tensions

The exclusion of Tesla from the proposed rebates signals a deeper political rift between Newsom and Musk.

Tesla’s dominance in the California EV market has waned, with its share of EV registrations dropping to 54.5% during the first three quarters of 2024, down from 63% in the same period the previous year.

In the Bloomberg report, Gene Munster, managing partner of Deepwater Asset Management, criticized the proposal, stating, “This is a slap in Tesla’s face.”

Musk’s relationship with California has been fraught with conflict.

In 2021, Tesla moved its headquarters to Texas, citing frustration with California’s regulatory environment.

The decision followed disputes over COVID-19 lockdowns, which Musk derided as “fascist.”

Despite these tensions, California remains Tesla’s largest domestic market, with the company accounting for more than half of all EVs sold in the state.

EV policy at the crossroads under Trump

Newsom’s rebate plan also underscores California’s broader struggle to shield its progressive climate policies from Trump’s deregulatory agenda.

Trump has vowed to roll back federal EV subsidies and fuel-efficiency standards, calling them an “EV mandate.”

During his first term, Trump targeted California’s ability to set tougher emissions standards under the Clean Air Act, and his incoming administration is expected to renew those efforts.

California and several other states, including Oregon and Colorado, currently set their own vehicle emissions standards, which more than a dozen states follow.

By excluding Tesla, Newsom appears to be signaling his intention to foster competition among EV manufacturers, even as he positions himself as a climate leader willing to confront Musk, a Trump ally.

‘Animal spirits’, not fundamentals driving Tesla’s gains: UBS

Analysts at UBS Group AG have cautioned investors that Tesla’s recent stock rally was driven more by market sentiment than by improvements in its fundamentals.

The company has added more than $350 billion in market capitalization since election day.

“The rise in Tesla stock is mostly driven by animal spirits/momentum,” Joseph Spak, an analyst at UBS, wrote in a report.

“Removing consumer tax credits for electric-vehicle purchases could force Tesla to have to cut prices,” Spak added.

Investors anticipate that the Trump-Musk alliance could benefit Tesla, potentially introducing a national standard for self-driving cars, which would simplify the launch of autonomous taxi services.

Spak however noted that while Trump’s policies may favor AI and autonomous vehicle ventures, Tesla lacks a ready-to-market robotaxi to benefit from these regulatory changes.

He maintained a sell rating on the shares while raising his price target to $226 from $197.

The post Tesla excluded from California’s proposed EV buyer incentive program, stock drops: ‘This is insane’ appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Google tweaks European search results to address antitrust complaints under DMA
next post
Forget Affirm, Block, and Klarna; this BNPL stock is killing it

Related Posts

Twilio stock price forecast: technicals point to a...

February 13, 2025

Saudi Aramco Q3 profit drops 15.4% amid lower...

November 5, 2024

How China’s DeepSeek’s rise cost the world’s richest...

January 28, 2025

Asia-Pacific markets mixed as Japan inflation data, Trump...

February 21, 2025

Record sales, shrinking margins: a mixed quarter for...

January 29, 2025

Lucid Group stock plunged to $2: Could LCID...

November 18, 2024

Electric air taxi maker Archer Aviation gets key...

June 7, 2024

Tesla ordered to pay $329M over fatal autopilot...

August 2, 2025

Wayfair stock nears key price as it prepares...

January 22, 2025

Analyst explains why ‘market is wrong’ in selling...

May 31, 2025

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • FBI raid on John Bolton’s home in Washington linked to classified documents

      August 25, 2025
    • Argentine senate deals blow to Milei’s austerity agenda with university budget boost

      August 25, 2025
    • Jackson Hole Symposium: what Powell said about economic effects of Trump’s tariffs

      August 25, 2025
    • At Jackson Hole, Fed Chair Powell signals possible cuts while warning of uncertainty

      August 25, 2025
    • Trump threatens to fire Fed Governor Lisa Cook amid mortgage fraud allegations

      August 25, 2025

    Categories

    • Business (3,753)
    • Investing (2,776)
    • Latest News (2,048)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved