[Reuters] President-elect Donald Trump's transition team is planning to kill the $7,500 consumer tax credit for electric-vehicle purchases as part of broader tax-reform legislation, two sources with direct knowledge of the matter told Reuters.Ending the tax credit could have grave implications for an already stalling U.S. EV transition. And yet representatives of Tesla (TSLA.O) - by far the nation's biggest EV maker - have told a Trump-transition committee they support ending the subsidy, said the two sources, speaking on condition of anonymity.
Tesla CEO Elon Musk, one of Trump's biggest backers and the world's richest person, said in July that killing the subsidy might slightly hurt Tesla sales but would be "devastating" to its U.S. EV competitors, which include legacy automakers such as General Motors (GM.N).
Shares of Tesla ended nearly 6% lower at $311.18, while shares of smaller EV rival Rivian (RIVN.O) closed down 14% at $10.31. Lucid (LCID.O), another EV maker, tumbled 5% to $2.08.
Repealing the subsidy, a signature measure of Democratic President Joe Biden's Inflation Reduction Act (IRA), is being discussed in meetings by an energy-policy transition team led by billionaire oilman Harold Hamm, founder of Continental Resources, and Republican North Dakota Governor Doug Burgum, the two sources said.
The group has met several times since Trump's Nov. 5 election victory, including at his Florida Mar-a-Lago club, where Musk has also spent considerable time since the election.
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