Tesla, once the shining star of the automotive industry, is now confronting significant difficulties that threaten its reputation and financial outlook. According to a former Tesla executive speaking to the Financial Times, CEO Elon Musk has only recently recognized the serious impact of political decisions on the company’s future.
The source points to President Donald Trump’s recent “Big Beautiful Bill” as a major setback for Tesla. Signed into law over the weekend, the bill removes tax credits for electric vehicle (EV) purchases, eliminates fines for automakers exceeding fuel-efficiency targets, and rolls back incentives for wind and solar energy. These measures collectively undermine several key supports that Tesla has relied upon for growth.
Musk strongly opposed the bill, calling it “an abomination” due to its potential to increase the national deficit. His frustration was so intense that he announced plans to form a new political party. However, industry insiders warn that Tesla itself will suffer most from these policy changes.
The former executive described the bill’s effects as “terrible policy and a devastating blow for Tesla’s bottom line.” The impact extends beyond just fuel-efficiency standards, encompassing tariffs, consumer credits, manufacturing tax incentives, and solar power subsidies. They added, “Elon has finally woken up to this, but talk about a day late and a dollar short.”
Tesla’s future now appears uncertain as it grapples with reduced government support and the high costs of its investments in artificial intelligence and robotics, which are unlikely to yield near-term returns.
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