took another turn Thursday.
President Joe Biden praised
(ticker: GM) again as an electric-vehicle leader in a video with GM CEO Mary Barra. Musk responded—on
Current issues between Tesla (TSLA) and the administration date back to August, when the president announced his goal for 50% of new car sales in the U.S. to be all-electric by 2030 at a White House event. The three largest employers of the United Auto Workers union—GM,
(F), and Stellantis (STLA)—were present. Tesla—the world’s largest maker of all-electric vehicles and the most valuable auto maker globally—wasn’t invited. Tesla, however, isn’t unionized, which White House Press Secretary Jen Psaki later suggested as a reason for the snub.
It seems to have gotten under Musk’s skin. In September, he suggested in a few tweets that Biden was out of touch with the current EV situation and more interested in unions than vehicle electrification.
This week, Biden and Barra talk about EV leadership in a video and discuss GM’s newly announced plans to invest about $7 billion in EV assembly and battery capacity in Michigan.
The president’s tweet presenting the video mentions
and GM, but not Tesla.
So Musk spelled the company’s name out in a subsequent tweet. “Starts with a T, Ends with an A, has ESL in the middle,” Musk explained.
Musk has a point. It’s, frankly, odd that Tesla, an American company, doesn’t get mentioned by the White House, which hasn’t responded to multiple requests for comment about the issue. Ford and GM sold about 27,000 and 25,000 EVs in the U.S. in 2021. Tesla sold about 361,000 and more than 936,000 worldwide last year. Tesla and the White House didn’t immediately respond to requests for comment on Friday.
For now the situation is just theater. But the Biden agenda does have the potential to affect Tesla stock. Biden’s Build Back Better bill had an extra purchase incentive for EVs made with unionized labor. That would have put Tesla at a disadvantage versus Ford and GM. The extra discount might amount to 5% to 10% of an EV. That bill, however, didn’t pass when Sen. Joe Manchin said he wouldn’t vote for it.
Tesla stock is down for a second day after the company’s fourth-quarter earnings report. Shares slipped f 1.6% at about $816 in premarket trading, while
Dow Jones Industrial Average
futures are down about 0.8% and 0.9%, respectively.
kerfuffle isn’t affecting Tesla stock this week, however. Investor expectations just got too high going into Tesla’s earnings report. Tesla beat Wall Street estimates by about 8%, but investors, apparently, wanted to hear more about new vehicle models on the company’s earning conference call. Musk said no new models would be introduced in 2022 because the company’s singular focus is increasing output at its manufacturing plants.
Write to Al Root at email@example.com