On Monday, Tesla Inc. crossed $1 trillion in market value, joining a select group of companies after its stock price more than doubled this past year on surging vehicle sales and rising profits. Investors pushed the electric vehicle maker over the line after Hertz ordered 100,000 autos to be delivered to the rental car company by the end of next year, a bulk purchase that promises to expose more mainstream drivers to Tesla’s technology. Apple Inc. Microsoft Corp., Amazon.com Inc., Google parent Alphabet Inc. are the only U.S. companies worth more than $1 trillion.
As for Tesla, its market cap exceeds that of the next nine largest automakers combined. Toyota is worth $237 billion, GM only $84 billion, and Ford $64 billion.
No one should begrudge Mr. Musk his commercial success, but one question comes to mind: Why does Tesla still need subsidies to make and consumers to buy electric cars? The House reconciliation bill would extend the existing $7,500 EV tax credit through 2031 and remove the 200,000 car per-manufacturer cap, which both GM and Tesla have hit. This is in addition to the many other government subsidies to produce batteries and the cars themselves. Tesla also benefits from selling regulatory credits to companies that don’t produce enough electric or hybrid cars to meet government mandates. Tesla’s 10-Q filing shows revenue of $1.15 billion from selling regulatory credits through Sept. 30 this year. These credits are a false economy - nothing is produced to account for this transfer of wealth.
A $1 trillion company doesn’t need government aid. If the Democrats follow through on their latest plan to impose a new wealth tax, the IRS will soon be pursuing Mr. Musk to turn over much of his wealth and any gain in his Tesla shares. We prefer to let him keep the gains of his entrepreneurial tenacity but give up the subsidies.
Have you noticed a difference in an attitude towards specific tax subsidies depending on which side of the political spectrum you lie? Are oil subsidies okay, but EV vehicles are not…or visa versa? Here is another example of legislation not having a fixed exit plan - a specific measurement that sunsets the law. In this case, the regulatory credits will continue as long as GM/Ford fails to produce enough electric vehicles - a punishment and a gift? Of course, the cap of 200,000 vehicles was supposed to end the EV subsidy, but the greenies decided to continue it - cause it is one of the ‘good ones.’
Tesla...Time to give up Subsidies
Green stuff is good!!!! It’s in fashion now. Imagine what they would cost without the federal subsidies. 😜😜