Elon Musk's Political Shift and Tesla's Continued Lobbying for Government Benefits

Musk embraces Trump and scorns subsidies. But Tesla still lobbies for US benefits

Harris running mate Gov. Tim Walz owns no stocks, bonds or real estate, disclosure shows People familiar with Musk's management at the carmaker told Reuters his approach to subsidies is pragmatic, a willingness to accept public money if it's there for the taking. Musk's willingness to overlook outright Republican opposition to an industry he helped pioneer, meanwhile, signals a broader focus on goals that may not dovetail with the immediate interests of his businesses. "Tesla is not the endgame for him," said Andrew Ward, a management professor at Lehigh University, noting Musk's holdings in sectors ranging from artificial intelligence to space exploration to neuroscience. Musk could "sacrifice some of the short-term interest in Tesla," Ward added, "if it'll satisfy the long-term interests of his ambitions." Musk and Tesla didn't respond to requests from Reuters for comment. A spokesman for Trump didn't respond, either. A White House spokesman declined to comment. The growing bond between Trump and Musk could be on display Monday night, when the Tesla boss is scheduled to interview the Republican candidate on X, Musk's social media platform. It's unclear exactly what ambitions Musk could seek to advance through his increasingly vocal rejection of progressive platforms - from EV subsidies to identity politics. His support for Trump, once tenuous, solidified in July, when Musk, after the failed assassination attempt against the former president, endorsed Trump and said he would fund a political action committee that federal records show has spent $21 million to support him and oppose the Democratic ticket. Days after the endorsement, one user on X asked Musk if he would comment on Trump's views on EVs. "It will be fine," Musk responded. Whatever Musk's endgame, the public record clearly shows that Tesla, since its founding over two decades ago, has benefitted from government assistance, largely because of its role in moving the U.S. toward cleaner cars. Tesla's first major manufacturing facility, in Fremont, California, was developed with the help of a $465 million loan from the U.S. Department of Energy, repaid three years later. More recently, Tesla has reaped almost $9 billion since 2018 by selling what are known as "regulatory credits, opens new tab," securities filings show. The credits, awarded in the U.S. by the federal and state governments to manufacturers who surpass increasingly strict emissions rules, can be sold to other carmakers who are unable to comply. "There was no Tesla without California's regulatory bodies," California Governor Gavin Newsom said at a 2022 conference, citing the importance of the state's credits to the carmaker's finances. A Reuters review of Congressional lobbying records - and Tesla's public comments to federal and state regulators - shows that the company has continued working to shape public policy in favor of such benefits. Earlier this year, in a February filing with the U.S. Department of the Treasury, Tesla said that sustained government support, by accelerating the transition away from fossil fuels, would "mitigate greenhouse gas emissions, and protect the country's public health and welfare."

Elon Musk's political views won't help Tesla

Elon Musk and the company that made him a household name have been at odds recently. There was the pay package debacle, the time Musk threatened to take the AI wing and leave, his recent weird waffling over climate change -- Musk and Tesla are far from seeing eye to eye. Now, that even extends to preferences in political action, according to Reuters: When Elon Musk endorsed Donald Trump for president last month, the Tesla founder and chief executive backed a candidate who vows to "drill, baby, drill," "end the electric vehicle mandate" and reduce subsidies of the sort that helped Tesla become the U.S.'s dominant EV manufacturer. So instrumental have government loans, tax breaks and other EV policies been to Tesla's fast growth that despite Musk's gradual embrace of the former president and his Republican Party rhetoric in recent years, the company continues to lobby the U.S. and state governments for benefits championed by the Democratic Party. In February, for instance, Tesla in a filing with the U.S. Environmental Protection Agency, or EPA, urged the Biden administration to allow California to pursue stricter vehicle emissions rules than the rest of the country - an idea Trump opposes. Months earlier, in a previous filing with the agency, Tesla lobbied the government for regulations that would ban the production of most new gasoline cars by 2035 - the so-called "EV mandate" that Trump and others on the American right have criticized. It's likely that Musk simply cares enough about other political causes to ignore a mismatch on climate, but he's become something of a right-wing figurehead -- an odd position for a self-proclaimed environmentalist to hold. Does he still proclaim that?