5 hours Ago By Chris Katje
An executive order signed by President Donald Trump put an emphasis on ending electric vehicle plans put in place by former President Joe Biden and could put an end to the $7,500 tax credits that helped boost the sector. What Happened: One of Trump's first tasks since becoming president was to sign the "Unleashing American Energy" executive order. Trump's order says he is eliminating the "electric vehicle mandate" and also terminating the Green New Deal.
While Trump may need additional approval to end the $7,500 tax credit American consumers can currently get for buying numerous electric vehicle models, including several from Tesla Inc TSLA , the order pauses the disbursement of funds that were part of the Inflation Reduction Act of 2022. The electric vehicle tax credits have helped boost sales of EVs over the past several years, including Tesla. Once a beneficiary of tax credits for his company, Tesla CEO Elon Musk has changed his tune about the credits in recent years.
Musk said recently that he was okay with the tax credits going away and has pledged his support to Trump, who he supported during the 2024 presidential election. In a quarterly earnings call in July 2024, Musk said Trump winning the election and the end of the tax credits could be "devastating" for Tesla rivals, but would likely end up being a long-term positive for his company. "Long term probably actually helps Tesla, would be my guess, yes," Musk said at the time.
With the potential of the EV tax credits going away, Tesla influencer Sawyer Merritt conducted a poll on social media platform X to see if people thought the move would help or hurt Tesla. "Long-term is the U.S.
EV credit disappearing bullish, bearish, or neutral for Tesla," Merritt asked. Here are the poll results , based on 16,294 votes. Bullish: 40.
4% Neutral: 27.5% Bearish : 19.4% See Results: 12.
6% The largest percentage of voters believe the EV tax credit going away would be bullish for Tesla. This is likely related to the belief that the move would be bad for most EV companies, but hurt Tesla's competitors more. Tesla has profitability per vehicle and vertical integration for manufacturing, which helps the company on costs and scale.
When asked for his opinion, Merritt said he was neutral on the potential change. "Hard to argue that it's really bullish since Tesla is currently the largest beneficiary of the EV credit, but it disappearing I don't think will be a negative as some are suggesting. Tesla is no doubt in the strongest position to withstand the impact of it disappearing vs their legacy auto competition," Merritt said.
Read Also: Gary Black Questions Elon Musk’s Take On EV Credit Removal After Tesla Sales Drop In Europe: ‘Not Sure How The Math Works’ Why It's Important: Musk's stance on being against tax credits that help boost the market share of electric vehicle companies could be a surprise to many given his past support for the sector. "Since the company's inception in 2003, Tesla's mission has been to accelerate the world's transition to sustainable energy," Tesla's website reads . Musk has said in the past that the acceleration of sustainable energy is fundamental to the future of humanity, as reported by CNBC .
These days, Musk and Tesla are focusing heavily on autonomous vehicles which could be the next political move by the Trump administration. Trump previously said he would ban autonomous vehicles from American roads. Since then, Trump may have reversed his stance and come around to help boost the future of Musk's company by pushing autonomous vehicle testing forward and making Tesla's vision a reality.
Musk has watched his wealth soar to over $400 billion since Trump won the 2024 presidential election. While the new EV tax credit rules could be bad for the electric vehicle sector over time, the current president is likely going to be good for Musk and his company. The question is what the short and long-term impacts on Tesla will be.
Based on the poll, investors don't seem too concerned about the potential loss of EV tax credits. TSLA Price Action : Tesla stock closed down 0.57% to $424.
07 on Tuesday versus a 52-week trading range of $138.80 to $488.54.
Tesla stock is up 103% over the last year. Tesla's drop came while many stocks were up on the first trading day after Trump's inauguration with the SPDR S&P 500 ETF up 0.92% to $603.
05 Tuesday. Read Next: US Electric Vehicle Sales Hit Record 1.3 Million Units In 2024, Despite Tesla Declines: Top 10 Bestselling Models Photo: Courtesy Tesla © 2025 Benzinga.
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