Does Tesla Get Government Subsidies?

Tesla's Optimus Robot Will Be ...

Yes. Like almost all large companies, Tesla takes advantage of incentives and subsidies from federal, state, and local governments. This helps them to accelerate the construction of factories, expand existing facilities and grow the business at a faster rate.

Of course, not everyone sees this as fair. However, governments are always making offers of tax breaks, subsidies, and other financial incentives to companies in order to help their constituents. This makes financial sense as the growth in jobs, expansion of supporting businesses and opportunities that they usually see as a result makes it worth it.

It is not simply a hand-out of free money to a company, but usually some form of agreement that comes with benefits to both sides. On the one side, the company gets money, tax incentives, or similar. Sometimes along with help smoothing the way for a new permit or other things they need.

In return, companies are held to agreements, often with penalties, for the number of jobs they provide and other measures of growth for the local community. On top of this, the fact that companies and their employees reside in a given area means that they will all pay taxes into the local government pot over the years they are in that location.

What Government Subsidies Has Tesla Received?

Luckily for us, the LA Times has done a great job at tracking the subsidies Tesla has received over the years. I believe some are missing, but their list seems reasonably complete.

This is the list they have found:

$1.29 billion — Nevada tax incentives for Gigafactory

$45 million — Value of discounted Department of Energy loan

$90 million — California Alternative Energy and Advanced Transportation Financing Authority

$517.2 million — Sale of California and other regulatory credits

$284 million — Estimate federal income tax credits for car sales (Note: which all auto companies are eligible for sales of EVs, even today)

$38 million — Value of California rebate for California buyers of Tesla vehicles

$126 million — California Self-Generation Incentive Program

$647,626 — California job training reimbursement

Their total comes in at around $2.4 Billion.

I would also add the subsidies they received for the Gigafactory in Buffalo, New York, which was valued at $750 million.

And, the new Gigafactory in Austin, Texas has received $60 million in incentives.

Therefore, the total value of subsidies Tesla has received over the last few decades is around $3.1 Billion.

Is Tesla Any Different When It Comes Subsidies?

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The thing that Elon Musk and many others find so amusing, and perhaps even insulting is that subsidies and tax breaks are a standard business practice. Governments are playing these games all the time to lure the big corporations to their regions.

Some of you will probably remember all the shenanigans that went on to try to get Amazon to build its second headquarters a few years ago!

And it’s not just the big guns like Amazon or Google. Most big companies, including other automotive manufacturers, play the same games.

There is even a list of the most subsidized companies around.

Most of the biggest ones are oil and gas, automotive, aerospace and other engineering or manufacturing giants.

Although a lot of noise is made about Elons billions and the subsidies he has “conned” out of the poor taxpayer, in the end, it is standard business practice and Tesla is far from the worst of those suckling at the government teat!

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