Tesla would be bankrupt without California, claims Governor Newsom

Tesla Fremont factory courtesy of Becca Farsace / The Verge
Credit: Becca Farsace | The Verge

Tesla might not call California its home anymore, but it still has a large presence in the state with its factory in Fremont and other nearby facilities. It has also grown to now have 6 factories on three different continents, and is on a path to set another record with well over 1 million deliveries this year.

According to California Governor Gavin Newsom, Tesla would not even exist today were it not for the state’s incentives.

Newsom made the claim earlier this month during a panel with other governors from states along the west coast, saying California’s clean-air policies are the reason Tesla did not go bankrupt in its early days.

“There was no Tesla without California’s regulatory bodies, and regulation. [Tesla] been a beneficiary of well over a billion dollars of subsidies” that enabled it to “grow and dominate the electric vehicle space,” he said (via San Francisco Chronicle)

Newsom didn’t stop there, adding to the rhetoric at the Climate Week Summit in New York last week saying CEO Elon Musk was “inspired by the regulatory framework in California that created that industry.”

According to the governor’s office, since 2009 Tesla has received $3.2 billion in both direct subsidies, like rebate and sales-tax credits, and indirect subsidies like money it can earn by selling credits for production zero-emission vehicles.

The majority of that $3.2 billion came from the sale of ZEV credits. Tesla has been able to earn $2.48 billion by selling credits to other automakers that needed them to meet California’s emissions standards because they chose not to invest and develop zero-emission vehicles, instead opting to continue churning out fossil fuel burning vehicles.

Newsom’s comments are likely less of a dig at Tesla than an effort to promote his state as a champion of the clean-energy tech sector, and in particular zero-emission vehicles. California has already passed legislation banning the sale of most new gas cars by 2035, one of the more aggressive targets in North America.

These efforts are particularly needed after Musk moved Tesla’s headquarters to Texas, saying “California used to be the land of opportunity,” but has now become “more so the land of overregulation, overlitigation, overtaxation and scorn.”

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Founder and Editor-in-chief of Drive Tesla Canada | Darryn@DriveTeslaCanada.ca Have a Tesla tip? Email tips@driveteslacanada.ca, or DM us on Twitter @DriveTeslaca