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Tesla is getting paid record amounts thanks to legacy auto’s failure to adopt EVs

(Photo: Andres GE)

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Against all odds, Tesla managed to turn a profitable first quarter this year. Several factors came into play to accomplish this feat. The company was able to optimize its operations and vehicle production costs, Tesla Energy continued to ramp, and the Model Y proved profitable from the get-go. Apart from this, Tesla’s financials were also boosted by $354 million that came from selling regulatory credits. 

Tesla sold a record amount of regulatory credits in the first quarter, signifying a 64% increase compared to Q1 2019. As noted in a Car and Driver report, Tesla acquires regulatory credits across the globe. The credits are given out to carmakers based on the number of electric vehicles they sell. In other territories, the credits are given based on the emissions from a carmaker’s fleet. Tesla, being an all-electric car maker, is able to acquire these credits. 

In the case of California’s Zero Emissions Vehicle (ZEV) program, carmakers are mandated to sell a certain number of electric vehicles that are relative to their total number of sales. If a company’s EV sales are insufficient, they are given fines unless they purchase credits from companies such as Tesla. So far, Fiat Chrysler and General Motors have admitted that they buy ZEV credits from the electric car maker. 

This presents a rather interesting set of circumstances for Tesla and its mission to accelerate the world’s transition to sustainability. The sale of regulatory credits generally happens when another automaker fails in meeting environmental standards, and so far, this failure has become a means for Tesla to strengthen its finances. This first quarter alone, Tesla’s results would have been less satisfactory without its regulatory credit sales. 

While there are challenges in the future, such as the US’ upcoming adoption of the less environmentally-friendly Safer Affordable Fuel-Efficient (SAFE) emissions regulations, other regions such as Europe will likely provide Tesla with more opportunities to gain more financial incentives for its all-electric fleet. This means that as long as legacy auto drags its feet with its transition to an electric fleet, Tesla could end up strengthening its finances more and more. 

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Unfortunately, reports about General Motors and Ford’s US production plans have revealed that the two veteran automakers intend to maintain a heavy emphasis on pickup trucks and SUVs all the way to the mid-2020s. Both Ford and GM talk a big game when it comes to their future EV plans, but the two companies’ production plans suggest otherwise. This trend may not be unique for the two American automakers either, as other legacy carmakers also seem to be having issues transitioning to an electric fleet. 

Embracing electric transportation will likely be a painful process for legacy automakers, as each company would have to abandon decades worth of innovation in the internal combustion engine for the sake of battery and electric motor tech. Tesla is uniquely positioned to take full advantage of this situation, and it may very well end up with a stronger balance sheet when the dust clears. 

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Tesla China comeback: Retail sales hit second-highest month of 2025

Tesla’s September numbers are just below the 74,127 units that were sold domestically in March.

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Credit: Tesla China

Tesla’s retail sales in China climbed to 71,525 vehicles in September, the company’s second-highest monthly total this year, as per data from the China Passenger Car Association (CPCA). 

The result reflects a steady rebound, narrowing Tesla’s year-on-year sales decline to just 0.93%, while showing a 25% jump from August’s weaker numbers. Tesla China’s September numbers are just below the 74,127 units that were sold domestically in March.

Tesla China’s September

Despite the uptick, Tesla China’s retail sales have now logged seven months of year-on-year declines this 2025, managing growth only in March and June, though a good portion of these lost sales was due to the changeover to the new Model Y. The Shanghai Gigafactory, which produces both the Model 3 and Model Y, continues to serve as a dual-purpose hub for domestic and export markets.

In September, Tesla exported 19,287 vehicles from its Shanghai facility, up 19.6% year-on-year but down 25.9% from August, as noted in a CNEV Post report. This is in line with Tesla China’s strategy of prioritizing exports early in each quarter. Including exports, Tesla China’s total wholesale volume reached 90,812 units in September, up 2.82% year-on-year and 9.16% month-on-month.

Model Y still leads

The Tesla Model Y still led the electric vehicle maker’s sales in China with 59,907 units sold wholesale during the month, rising 17.1% from last year, while Model 3 reached 30,905 units, dipping 16.8% year-on-year but up 27% from August. Tesla’s overall market share in China’s NEV segment rose to 5.52%, and its BEV share climbed to 8.66%, modest gains hinting at the company’s resilience in a fiercely competitive market.

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Across Q3, Tesla sold 169,294 vehicles in China, down 6.9% year-on-year, marking its second consecutive quarterly decline but a strong 31.4% recovery versus Q2. Year-to-date, Tesla’s retail total stands at 432,704 units, down 5.97% compared to last year.

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Elon Musk teases ‘Banish’ feature to pair perfectly with Summon

Tesla has long promised the possibility of completely hands-off parking: arrive, drop off at the entrance, the car parks itself, and the car retrieves you at the end of your visit.

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Credit: Tesla China

Elon Musk has once again teased the “Banish” feature that could come to Tesla vehicles in the near future. It would be a perfect pairing to the popular Assisted Smart Summon (ASS), which the company launched earlier this year.

Banish has been something Tesla has teased for years. The company has promised the possibility of completely hands-off parking: arrive, drop off at the entrance, the car parks itself, and the car retrieves you at the end of your visit.

Ultimately, even though it is technically a driverless feature, Tesla has not refined its parking portion of the Full Self-Driving (Supervised) suite enough to release Banish to the public.

Tesla recently started performing specified parking tasks at the driver’s discretion. In the FSD (Supervised) v14.1 release, Tesla has added the ability to pick your parking scenario. Drivers can choose a Charger, Parking Lot, Curbside, Street, Driveway, or Parking Garage.

To achieve Banish, Tesla would have to gather enough data with these scenarios to then gain the capability to park after dropping vehicle occupants off.

However, CEO Elon Musk recently hyped Banish to the point of stating Teslas will be capable of it “in the near future.”

His remark came in response to a video where FSD v14.1 drove around a Costco parking lot for twenty minutes looking for a spot:

Summon is a feature that has given Tesla its challenges, but the release of Assisted Smart Summon (ASS) has improved some of its capabilities.

I tested it after receiving v14.1, and it did a great job of taking the correct route and driving safely to my location:

There will likely be some time between now and when Tesla is able to release Banish. As previously noted, Tesla will need to collect enough data from real-world scenarios and obtain a proven track record of being able to handle lots and parking in a variety of environments while supervised.

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Tesla faces new blockade in Sweden as IF Metall escalates dispute

The action takes effect October 15 and will remain in place until Tesla signs a collective agreement.

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Credit: NicklasNilsso14/X

Just over a month after the Swedish Meditation Institute threw in the towel on Tesla and IF Metall’s conflict, the labor union has announced a new industrial action aimed at disrupting the electric vehicle maker’s operations in the country. 

Potential Tesla disruptions

The latest news involves a total work stoppage by Linde Material Handling, one of Sweden’s largest forklift companies, which services industrial clients nationwide. The action takes effect October 15 and will remain in place until Tesla signs a collective agreement, as noted in a Dagens Arbete (DA) report.

The stoppage will halt all forklift-related work Linde performs for Tesla’s local subsidiary, TM Sweden, including maintenance, repair, and service of trucks used across its facilities. Simon Petersson, IF Metall’s contract secretary, shared described the union’s latest effort in a comment to the publication.

“We know that Tesla has trucks in several locations and that they are in need of service, maintenance and repair. We are stopping that now. For Linde, this is not a big deal. They service trucks for a lot of companies and Tesla is a small player in their portfolio,” Petersson noted.

Not a sure strategy

Whether IF Metall’s latest effort will succeed against Tesla remains to be seen, especially since the electric vehicle maker has been pretty firm in its stance that its employees do not need a collective agreement. Still, the IF Metall contract secretary stated that Linde’s strike against Tesla should make it more difficult for the electric vehicle maker to operate its business in Sweden. 

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“It remains to be seen. But as I have said before, it is about many small streams. This stops everything Linde does for Tesla. So not only with them, but regardless of where the work takes place. So if Tesla has problems with a truck, they will not have it repaired or serviced,” Petersson stated.

Following the decision of the Swedish Meditation Institute to end the negotiations between IF Metall and Tesla early last month, the union noted that it would still try to pressure the EV maker to sign a collective agreement. Since then, the Electricians union, as well as the postmen’s unions Seko and ST have continued to initiate blockades against Tesla Sweden.

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