Trump Presidency Could Help Tesla Claims Elon Musk

It seems likely that President-Elect Donald Trump, a notorious climate change denier, will seek to wind back legislations governing environmental protections, including Zero Emission Vehicle (ZEV) credits, designed to encourage automobile manufacturers to make their vehicles environmentally friendly. Elon Musk, CEO of electric-car maker Tesla Motors, though, claims that instead of harming his business, the removal of ZEV credits could actually help Tesla.

According to Musk, ZEV credits have never been much of an incentive anyway, and benefit Tesla’s rivals more. Back in August, Musk attacked ZEV credits, saying during a second-quarter earnings call, “The standards are pathetically low. They need to be increased… It’s a crying shame that they haven’t. And as a result, you can barely sell the ZEV credits for pennies on the dollar.”

Now, dealing with a Trump Presidency that could seek to remove ZEV credits, Musk said such a move would make Tesla more competitive against rivals, such as GM or Ford.

“The incentives either don’t scale or are disadvantageous,” Musk said this week (via Business Insider). “If General Motors or Ford or somebody else makes electric vehicles, they get to monetize their ZEV credit at 100 cents on the dollar, so if there are two ZEV credits per vehicle, General Motors would have a $5,000 cost advantage over Tesla.”

“If people are concerned about Tesla incentives, they should be concerned with, ‘Well, how does Tesla overcome the disadvantage of EV incentives,'” Musk added.

While showing optimism regarding the potential removal of ZEV credits, Musk did stress that he believed more stringent incentives for creating environmentally friendly vehicles.

“We do believe there should be incentives and government incentives for electric vehicles,” Musk Explained, “but we believe they should be there for the good of the industry and to accelerate the advent of sustainable transport.”