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Automakers are not too happy with Senator Manchin's EV tax credit proposal Automakers are not too happy with Senator Manchin's EV tax credit proposal

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Automakers are not too happy with Senator Manchin’s EV tax credit proposal

(Credit: Rivian Stories/Rivian Automotive)

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Automakers aren’t too happy with Senator Manchin’s EV tax credit proposal. Reuters reported that several automakers want the Democratic Senator to revisit the proposal to restructure the $7,500 EV tax credit. Fears over new sourcing requirements for battery components and critical minerals are the key reasons.

In a response to reporters, the senator said that automakers need to be aggressive and use materials extracted from North America.

Manchin thinks automakers need to “get aggressive”

“Tell (automakers) to get aggressive and make sure that we’re extracting in North America, we’re processing in North America and we put a line on China.”

“I don’t believe that we should be building a transportation mode on the backs of foreign supply chains. I’m not going to do it.”

Automakers Are Upset

General Motors said Friday that “some of the provisions are challenging and cannot be achieved overnight.” It added that it was “encouraged by the framework laid forth in the legislative text.”

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Rivian’s Vice President of public policy, James Chen, pointed out that this legislation wouldn’t be good for consumers who were wanting an American-made EV.

“As currently drafted, this legislation will pull the rug out from consumers considering purchase of an American-made electric vehicle. The final package must extend the transition period to provide consumer choice and protect good-paying manufacturing jobs here at home.”

John Bozzella with the Alliance for Automotive Innovation told Reuters that he was having good conversations when asked if automakers had submitted specific changes to Manchin.

Senator Rubio plans to file an amendment on one condition.

Senator Marco Rubio said that he will file an amendment seeking to ensure EV credits can apply only on one condition.

The EV battery’s critical minerals need to be sourced in the U.S. or a country with which the U.S. has a free trade agreement.

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Elon Musk

“Take Back Tesla:” Unions and corporate watchdogs launch campaign against Musk’s 2025 pay package

A new shareholder campaign is calling for Tesla investors to vote against Elon Musk’s proposed 2025 CEO Performance Award.

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A new shareholder campaign is calling for Tesla investors to vote against Elon Musk’s proposed 2025 CEO Performance Award, arguing it would deepen governance risks and weaken corporate accountability.

Ahead of Tesla’s Q3 2025 earnings report, a coalition of unions and watchdogs launched the “Take Back Tesla” initiative, urging investors to reject Musk’s pay proposal at next month’s annual meeting. The plan would grant the CEO additional shares worth nearly $1 trillion over ten years, expanding his ownership stake in the company to about 25%.

Unions and watchdogs argue that Elon Musk’s proposed plan rewards distraction

The Take Back Tesla campaign is backed by groups such as the American Federation of Teachers, Public Citizen, Americans for Financial Reform, Ekō, People’s Action, and Stop the Money Pipeline. 

As could be seen on the campaign’s website, the groups are arguing that Musk’s focus on political ventures and external businesses has distracted him from leading Tesla. The group’s website called Musk’s new CEO Performance Award “outrageous” as it involves an amount of wealth that is unreachable even by today’s top executives.

“In order to unlock the full amount of shares proposed in this compensation plan, Tesla’s value would need to increase dramatically to $8.5 trillion. As Tesla’s proxy statement points out, that would make Tesla roughly 2x as valuable as the most valuable company in the world (Nvidia) today. Arguably, growing Tesla’s value to double the value of Nvidia would justify paying Musk something like double the compensation of Nvidia’s CEO. 

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“But the annual value of Musk’s trillion dollar pay package isn’t just 2 times what Nvidia’s CEO made last year (just under $50 million); it’s more than 2,000 times what Nvidia’s CEO made last year. At his current compensation of $49.9 million, it would take Nvidia’s CEO over 2,000 years to earn the amount that Elon Musk could earn, on average, per year for the next ten years,” the group argued.

Board defends package as necessary, though some pushback is present

Tesla’s board insists the compensation plan is essential to retain Musk and sustain the company’s innovation in AI, robotics, and self-driving technology. The automaker noted that previous skepticism from proxy firms such as ISS and Glass Lewis preceded a 20x rise in Tesla’s market capitalization since 2018, a feat that seemed unrealistic when it was proposed.

As noted in a CNBC report, New York City Comptroller Brad Lander, who oversees a $300 billion pension fund, stated that while Tesla has been a great investment, he “vociferously opposes” Elon Musk’s proposed 2025 CEO Performance Award. 

“Most of the time we’ve held Tesla stock, it has been a solid investment, it’s grown over time, and that’s why we haven’t chosen to dump it, he said, adding that he views Tesla’s Board as “insufficiently independent” since they have allowed Musk to be “absentee CEO.” Landers also argued that Tesla as a whole has failed to hit its targets when it comes to its Robotaxi program and its Full Self-Driving technology.

For context, Elon Musk has maintained that his 2025 CEO Performance Award is not designed for him to gather even more wealth. Instead, he stressed that it is required so that he could take a controlling stake in the company.

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Investor's Corner

Tesla Q3 2025 earnings: What analysts expect

The automaker delivered a record 497,099 vehicles and logged its highest-ever energy storage sales in Q3 2025. 

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Credit: Tesla China

Tesla’s (NASDAQ:TSLA) Q3 2025 earnings, which would be released after markets close today, could prove to be a test of confidence for the company’s shareholders. 

The automaker delivered a record 497,099 vehicles and logged its highest-ever energy storage sales, but analysts noted that these gains might have come at a cost. 

Record vehicle deliveries

Tesla’s profit per share is expected to fall about 25% year over year to around $0.53–$0.55, even as revenue rises from 4% to 6%, as noted in a report from Market Pulse. Analysts noted that Tesla’s record quarter was partly fueled by buyers rushing to complete purchases before the U.S. federal EV tax credit expired in September, a surge that could dampen Q4 demand. The company also dipped into its inventory to reach the record delivery number.

Analysts expect automotive gross margin (excluding regulatory credits) to land between a conservative 16.5% and 17%. This suggests that a good portion of Tesla’s Q3 delivery growth came from aggressive price cuts. If margins fall below 16.5%, it could hint at more cost pressures that the company would have to handle in the coming months.

Tesla’s Energy segment, meanwhile, is expected to act as a stabilizer. The business deployed 12.5 GWh of storage in Q3, driven by strong demand from AI data centers. Analysts expect this high-margin division to partially cushion the hit from the automaker’s thinner car profits.

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AI, FSD, and Musk’s role

Tesla’s lofty valuation, trading about 17% above the average analyst consensus of $365, would likely depend heavily on investor belief in its AI and robotics initiatives. Industry watchers have stated that management must deliver credible updates on Full Self-Driving and the Robotaxi program to help justify the company’s current valuation.

Elon Musk’s proposed 2025 CEO Performance Award, which proxy advisors have urged shareholders to reject, would likely be discussed in the Q3 2025 earnings call has well. Musk has hinted that a failed vote could jeopardize Tesla’s AI strategy, making the company’s upcoming results quite crucial for market confidence.

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Investor's Corner

Tesla Board Chair defends Elon Musk’s pay plan, slams proxy advisors

The letter comes ahead of Tesla’s 2025 Annual Meeting, where shareholders will vote on several key proposals.

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CeBIT Australia, CC BY 2.0 , via Wikimedia Commons

Tesla Chair Robyn Denholm has issued a strongly worded letter urging investors to reject the latest recommendations from proxy advisory firms ISS and Glass Lewis, saying their “one-size-fits-all” approach fails to recognize Tesla’s unique business model and track record. 

The letter comes ahead of Tesla’s 2025 Annual Meeting, where shareholders will vote on several key proposals including Elon Musk’s 2025 CEO Performance Award and director reelections.

Tesla slams proxy advisors’ models

Denholm criticized both firms for consistently opposing Tesla’s growth-oriented plans, noting that the company’s market capitalization has increased twentyfold since shareholders approved Musk’s 2018 performance package, which both advisors had opposed at the time. 

“Our shareholders have ignored their recommendations, and it’s a good thing they did,” she wrote. “Otherwise, you may have missed out on our market capitalization soaring 20x while the proxy advisors time and time again recommended “against” Tesla proposals designed to promote the sort of extraordinary growth we have enjoyed.”

The letter argued that Glass Lewis and ISS use robotic policies that don’t account for Tesla’s innovation-driven structure. Tesla’s leadership maintained that the 2025 CEO Performance Award will only reward Musk if he achieves extraordinary market capitalization and operational goals. The plan, Denholm stated, aligns Musk’s incentives with long-term shareholder interests.

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Tesla defends board leadership

Denholm also defended directors Ira Ehrenpreis and Kathleen Wilson-Thompson, calling them pivotal to Tesla’s governance and innovation strategy. She said both have driven Tesla’s growth and helped design compensation systems vital to competing in the AI and robotics talent race.

She warned that following ISS and Glass Lewis could turn Tesla into “just another car company,” and urged shareholders to “vote yes to robots, and reject robotic voting.” The letter also highlighted that neither ISS nor Glass Lewis owns Tesla stock, emphasizing that only shareholders “who have made an actual financial investment” should decide the company’s direction.

“If you prefer that Tesla turn into just another car company mired in the ways of the past, then you should follow ISS and Glass Lewis. If you believe that Tesla, under the visionary leadership of Elon and the oversight of a Board that includes business leaders with integrity like Ira, Kathleen and Joe, then you should vote with Tesla,” Denholm wrote.

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