Trump's Energy Team Targets EV Credit Amidst Larger Tax Reform Plans

President-elect Donald Trump's transition team plans to eliminate the $7,500 electric vehicle tax credit as part of a broader tax reform, with significant implications for U.S. EV progress. Tesla, the leading EV seller, surprisingly supports this move, which aims to offset Trump's proposed tax cuts.

In a move that could reshape the U.S. electric vehicle landscape, President-elect Donald Trump's transition team aims to eliminate the $7,500 consumer tax credit for EV purchases, according to sources close to the matter. This decision, part of a broader tax-reform strategy, threatens the slow progress of electric vehicle adoption nationwide.

Despite potentially negative impacts on sales, Tesla, the nation's largest electric vehicle seller, has reportedly expressed support for this plan. Elon Musk, Tesla's CEO and a prominent Trump supporter, noted that while Tesla might face setbacks, the real damage would hit its U.S. competitors, including legacy automakers like General Motors. Indeed, Tesla shares have already dipped following these developments.

The strategy is discussed by an energy-policy team led by oil magnate Harold Hamm. Following Trump's election victory, discussions have intensified, targeting Biden's Inflation Reduction Act. This potential removal of tax credits is believed to align with Republican goals, with support from within the oil-and-gas industry, and could be a key element in financing extensive Trump-proposed tax cuts.

(With inputs from agencies.)