Musk has Trump's ear, and that could help Tesla. Other EV makers? Maybe not so much

President-elect Donald Trump’s full-throated support for oil and gas drilling might be expected to send a chill through the electric vehicle industry were it not for a wild card in his fledgling administration: Tesla Chief Executive Elon Musk.

Trump has long railed against EV mandates and subsidies. Then came August, when Musk endorsed Trump and began pouring millions of dollars into the Trump campaign. Not long after, Trump said he was now in favor of some market share for EVs.

“I have to be, you know, because Elon endorsed me very strongly,” Trump said at a rally in Atlanta.

Clean transportation advocates are hopeful that Musk will continue to influence Trump’s position on EVs.

“If there’s a silver lining” to Trump’s victory, said Ramses Madou, chair of the Open Mobility Foundation, “it’s that Elon Musk can dial back on Trump’s anti-EV-ness.”

Here are some of the issues facing supporters of electric cars and trucks, and how Musk might influence them.

BUYER INCENTIVES

Reuters and other news organizations reported Friday that Trump plans to end the $7,500 consumer tax credit for EVs — a move that Musk supports.

After building his company on the back of federally financed buyer incentives, Musk believes Tesla no longer needs them — and that taking away the subsidies will mainly hurt his competitors.

“Take away the subsidies,” Musk wrote on X in July. “It will only help Tesla.”

Why would a company turn away such free money? Because Tesla is profitable, and the EV business at the traditional automakers as yet is not. Taking away buyer credits would hurt them more than it would hurt Tesla, whose EV market share has begun to drop in the face of new competition.

But there’s more to the story: So far this year, Tesla has posted $4.79 billion in profit. Of that, $2.07 billion came from government-required credits bought from Tesla by other automakers. That’s 43% of net income.

The EV federal credit system is simple in concept: Sell too many gasoline-powered cars, you accumulate deficits. If most of the vehicles you sell are EVs, you earn credits. To avoid government penalties, deficit holders must buy credits from companies like Tesla.

In other words, Tesla’s competitors are directly and dramatically boosting Tesla’s profits with rich flows of cash that they otherwise might have used in their own EV development.

How do EV buyer incentives fit in, and why might Musk want to see them gone? The fewer EVs other carmakers sell, the more credit money Tesla takes in as pure profit, boosting its own stock price and putting pressure on the shares of competitors. Since the election, Tesla stock is up 28%, closing at $320.72 on Friday. Most other automakers' shares are stuck in neutral.