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Tesla, built on government welfare, is failing even with record subsidies from taxpayers. [1]
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Date: 2025-05-09
Elon Musk and Tesla have always been more hype than reality, and their fragility is now showing. The emperor has no clothes.
Tesla was built on government welfare.
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Summary
Tesla’s recent sales slump highlights the fragility of a company long propped up by taxpayer subsidies and a cult of personality around Elon Musk. Despite years of preferential treatment—from federal loans and state tax breaks to lucrative emissions-credit sales—Tesla’s global deliveries fell sharply in early 2025 while competitors gained ground, suggesting the emperor’s electric vehicle empire may finally be losing its shine.
Government welfare: Tesla has received billions in federal loans, state tax incentives, and emissions-credit revenue that masked underlying weaknesses.
Tesla has received billions in federal loans, state tax incentives, and emissions-credit revenue that masked underlying weaknesses. Sales reversal: Global deliveries dropped 13 percent in Q1 2025 even as overall U.S. EV sales grew, eroding Tesla’s once-dominant market share.
Global deliveries dropped 13 percent in Q1 2025 even as overall U.S. EV sales grew, eroding Tesla’s once-dominant market share. European collapse: First-quarter registrations plunged across the EU, where consumers cite Musk’s political antics and outdated models as turn-offs.
First-quarter registrations plunged across the EU, where consumers cite Musk’s political antics and outdated models as turn-offs. Investor anxiety: A Morgan Stanley survey found 85 percent of investors view Musk’s political behavior as a threat to Tesla’s fundamentals.
A Morgan Stanley survey found 85 percent of investors view Musk’s political behavior as a threat to Tesla’s fundamentals. Subsidy addiction: New factory deals in Texas and elsewhere still rely on multi-million-dollar tax abatements that drain local public services.
A progressive lens sees Tesla’s troubles as a cautionary tale: When public dollars underwrite private profit without demanding labor protections, community benefits, or democratic oversight, the result is predictable—corporate capture of green policy and fragile gains for workers. Redirecting subsidies toward unionized, community-owned clean-tech ventures would build resilient jobs and ensure that the next generation of climate solutions serves people, not billionaires.
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