Three years ago, The Los Angeles Times posted “Elon Musk’s growing empire is fueled by $4.9 billion in government subsidies”. I have not seen a summary of the current total of Musk’s subsidies but it is certainly more than $4.9 billion now. When The LA Times speaks about an “empire” it included Tesla, Space X and Solar City—all Musk controlled businesses.
This discussion will focus on the Tesla electric vehicle (EV) business.
Subsidies start with the Federal Tax Credit of $7,500 given to each buyer of a Tesla EV. (Every EV maker gets the same treatment.). California also provides a $2500 subsidy per car.
The following is from the LA Times posting:
“Tesla has also collected more than $517 million from competing automakers by selling environmental credits. The regulation was developed in California and has been adopted by nine other states.”
These regulations require that companies selling automobiles must also sell a certain percentage of EVs. Sales of an EV gives the seller environmental credits. Manufacturers are penalized for not selling enough EVs and must buy credits to offset their failure. Because Tesla sells only EVs it gets a lot of credits which they sell to the other car makers.
The following 2016 video discusses what the Wall Street Journal thinks subsidies mean to the Tesla’s bottom line: (Please excuse the 15 second commercial. When video ends click back to this page.)






