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Tesla won’t slow despite Edmunds claim that loss of tax credit will “kill the U.S. EV market”
Edmunds has released a new study that claims the loss of federal tax credits for EV buyers is “likely to kill the U.S. EV market.” It goes on to say, “Without these credits, this market is likely to crash.” Edmunds bases its analysis on what happened when the state of Georgia repealed its EV incentive program in the middle of 2015. Not only did Georgia eliminate its EV incentive, it also imposed new fees on EV drivers designed to offset the loss of revenue the state experienced because cars with electric motors use less gasoline.
Up until then, Georgia gave every qualifying EV buyer a $5,000 credit — the largest in the nation. That was on top of the $7,500 federal tax credit and made buying an EV in Georgia a very attractive proposition. The biggest beneficiary was the Nissan LEAF. In June, 2015 — the last month the incentive was available — 1,008 of them were sold or leased. In July, after the rebate was no longer available, 66 cars were delivered.
Cars eligible for the state incentive accounted for up to 17% of the new car market in Georgia. Following the legislature’s decision to eliminate the credit, they have fallen to about 2% of sales. Note that is still higher than the percentage of EV sales in the US as a whole.
Should Tesla be concerned? Not really says the Motley Fool. Data compiled by IHS Markit and included in the Edmunds analysis shows a drop in sales of the Model S shortly after Georgia repealed its rebate but sales quickly recovered and have since gone on to set new records for the company in the Peachtree State.
The federal tax credit was originally a pump priming exercise intended to help EV manufacturers get started. The assumption Congress made when it first enacted the credit was that once a company had sold 200,000 cars with plugs, economies of scale would begin to kick in, making it possible to build and sell electrified cars profitably without government assistance.
-->Tesla is getting close to that figure and will surely pass it once the Model 3 gets into production this summer. After that, the federal tax credit for Tesla vehicles will begin to phase out. In addition, many people worry the Trump administration will kill the federal EV tax credit entirely. According to Edmunds, that means Tesla could suffer a dramatic decline in sales — at least in the US. Here’s why that won’t happen according to the Motley Fool.
Not so fast
First, any comparison between a 2015 Nissan LEAF and a 2018 Tesla Model 3 is a lopsided contest. The LEAF is a fine car but it suffers from a serious lack of range. Nor does it have any of the industry leading technology Tesla offers its customers. It relies on the CHAdeMO charging standard, which is rapidly losing ground to the CCS standard and the Tesla Supercharger network.
Red Tesla Model 3 at the vehicle unveiling event on March 31, 2016 from the company’s Hawthorne, CA Design Center.
Second, the base price of the Model 3 is $35,000, which happens to be very near the average selling price of a new passenger vehicle in the US market today. With or without incentives, the Model 3 will be highly competitive. With nearly 400,000 reservations worldwide, demand for the Model 3 is clearly not dependent on government financial incentives.
The real issue here is that electric car sales have not advanced as quickly as electric car advocates predicted. Range anxiety, lack of charging infrastructure, and fear of the unknown have kept many people from buying an electric car, whether from Tesla or any other manufacturer. The “tipping point” when electric cars become the first choice of mainstream car buyers is tantalizingly close but still not here yet.
Reasonable people may disagree about the best way to promote electric cars. Paying people to buy them may not be as beneficial to society as subsidizing the infrastructure needed to charge them. The interstate highway system was a hugely expensive undertaking but it unleashed an unprecedented surge in US economic output. Today it is still the backbone of commerce in America. Putting the money used to fund the federal EV tax credit to work building the nation’s charging infrastructure could be a more efficient use of resources.
By any analysis, the Tesla phenomenon is not dependent on government incentives. It is based on building compelling electric automobiles that outperform the competition. Elon Musk deliberately chose to start at the top of the market to attract those who influence public opinion. That strategy is working and will continue to work even if the federal tax credit is eliminated entirely.
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News
Tesla Europe rolls out FSD ride-alongs in the Netherlands’ holiday campaign
The festive event series comes amid Tesla’s ongoing push for regulatory approval of FSD across Europe.
Tesla Europe has announced that its “Future Holidays” campaign will feature Full Self-Driving (Supervised) ride-along experiences in the Netherlands.
The festive event series comes amid Tesla’s ongoing push for regulatory approval of FSD across Europe.
The Holiday program was announced by Tesla Europe & Middle East in a post on X. “Come get in the spirit with us. Featuring Caraoke, FSD Supervised ride-along experiences, holiday light shows with our S3XY lineup & more,” the company wrote in its post on X.
Per the program’s official website, fun activities will include Caraoke sessions and light shows with the S3XY vehicle lineup. It appears that Optimus will also be making an appearance at the events. Tesla even noted that the humanoid robot will be in “full party spirit,” so things might indeed be quite fun.
“This season, we’re introducing you to the fun of the future. Register for our holiday events to meet our robots, see if you can spot the Bot to win prizes, and check out our selection of exclusive merchandise and limited-edition gifts. Discover Tesla activities near you and discover what makes the future so festive,” Tesla wrote on its official website.
-->This announcement aligns with Tesla’s accelerating FSD efforts in Europe, where supervised ride-alongs could help demonstrate the tech to regulators and customers. The Netherlands, with its urban traffic and progressive EV policies, could serve as an ideal and valuable testing ground for FSD.
Tesla is currently hard at work pushing for the rollout of FSD to several European countries. Tesla has received approval to operate 19 FSD test vehicles on Spain’s roads, though this number could increase as the program develops. As per the Dirección General de Tráfico (DGT), Tesla would be able to operate its FSD fleet on any national route across Spain. Recent job openings also hint at Tesla starting FSD tests in Austria. Apart from this, the company is also holding FSD demonstrations in Germany, France, and Italy.
News
Tesla sees sharp November rebound in China as Model Y demand surges
New data from the China Passenger Car Association (CPCA) shows a 9.95% year-on-year increase and a 40.98% jump month-over-month.
Tesla’s sales momentum in China strengthened in November, with wholesale volumes rising to 86,700 units, reversing a slowdown seen in October.
New data from the China Passenger Car Association (CPCA) shows a 9.95% year-on-year increase and a 40.98% jump month-over-month. This was partly driven by tightened delivery windows, targeted marketing, and buyers moving to secure vehicles before changes to national purchase tax incentives take effect.
Tesla’s November rebound coincided with a noticeable spike in Model Y interest across China. Delivery wait times extended multiple times over the month, jumping from an initial 2–5 weeks to estimated handovers in January and February 2026 for most five-seat variants. Only the six-seat Model Y L kept its 4–8 week estimated delivery timeframe.
The company amplified these delivery updates across its Chinese social media channels, urging buyers to lock in orders early to secure 2025 delivery slots and preserve eligibility for current purchase tax incentives, as noted in a CNEV Post report. Tesla also highlighted that new inventory-built Model Y units were available for customers seeking guaranteed handovers before December 31.
This combination of urgency marketing and genuine supply-demand pressure seemed to have helped boost November’s volumes, stabilizing what had been a year marked by several months of year-over-year declines.
-->For the January–November period, Tesla China recorded 754,561 wholesale units, an 8.30% decline compared to the same period last year. The company’s Shanghai Gigafactory continues to operate as both a domestic production base and a major global export hub, building the Model 3 and Model Y for markets across Asia, Europe, and the Middle East, among other territories.
Tesla bear Michael Burry got blunt with his beliefs over the company’s valuation, which he called “ridiculously overvalued” in a newsletter to subscribers this past weekend.
“Tesla’s market capitalization is ridiculously overvalued today and has been for a good long time,” Burry, who was the inspiration for the movie The Big Short, and was portrayed by Christian Bale.
Burry went on to say, “As an aside, the Elon cult was all-in on electric cars until competition showed up, then all-in on autonomous driving until competition showed up, and now is all-in on robots — until competition shows up.”
Tesla bear Michael Burry ditches bet against $TSLA, says ‘media inflated’ the situation
For a long time, Burry has been skeptical of Tesla, its stock, and its CEO, Elon Musk, even placing a $530 million bet against shares several years ago. Eventually, Burry’s short position extended to other supporters of the company, including ARK Invest.
Tesla has long drawn skepticism from investors and more traditional analysts, who believe its valuation is overblown. However, the company is not traded as a traditional stock, something that other Wall Street firms have recognized.
While many believe the company has some serious pull as an automaker, an identity that helped it reach the valuation it has, Tesla has more than transformed into a robotics, AI, and self-driving play, pulling itself into the realm of some of the most recognizable stocks in tech.
Burry’s Scion Asset Management has put its money where its mouth is against Tesla stock on several occasions, but the firm has not yielded positive results, as shares have increased in value since 2020 by over 115 percent. The firm closed in May.
In 2020, it launched its short position, but by October 2021, it had ditched that position.
Tesla has had a tumultuous year on Wall Street, dipping significantly to around the $220 mark at one point. However, it rebounded significantly in September, climbing back up to the $400 region, as it currently trades at around $430.
It closed at $430.14 on Monday.
Tesla Europe rolls out FSD ride-alongs in the Netherlands’ holiday campaign
Tesla sees sharp November rebound in China as Model Y demand surges
