- Musk backs Trump to protect Tesla’s market share.
- EV competition erodes Tesla’s dominance.
- Regulatory changes could benefit Tesla at competitors’ expense.
Elon Musk’s unexpected endorsement of Donald Trump has left many scratching their heads. However, a closer look reveals a calculated move to protect Tesla’s market share.
Musk hopes a potential Trump presidency might dismantle Biden’s Inflation Reduction Act, which has spurred competition in the EV market and eroded Tesla’s once-dominant position.
EV price wars and profit plunges
Tesla’s recent financial woes underscore Musk’s desperation. The company’s profits have plummeted 45%, and its market share dipped below 50% for the first time.
Facing fierce competition globally and lacking new models, Tesla initiated a price war that’s now backfiring on its bottom line.
Regulatory roulette
Musk’s strategy hinges on preserving favorable regulations for Tesla. The company benefits from zero-emission vehicle credits, which ironically perform better when competitors sell fewer EVs. By backing Trump, Musk likely aims to maintain these advantages.
This move, however, raises questions about Musk’s commitment to sustainable transportation versus preserving Tesla’s market position at any cost.
