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GM and Fiat Chrysler Unmasked as Tesla's Secret Source of Cash

GM and Fiat Chrysler Unmasked as Tesla's Secret Source of Cash

By Miles Weiss and David Welch
June 3, 2019, 9:30 AM CDT

- Detroit carmakers disclose deals to buy regulatory credits
- GM says it’s hedging against ‘future regulatory uncertainties’

For years, Tesla Inc. has hauled in revenue by selling credits to other carmakers that needed to offset sales of polluting vehicles to U.S. consumers. These sorts of transactions have largely been shrouded in secrecy -- until now.

https://www.bloomberg.com/news/articles/2019-06-03/tesla-s-secret-source...

This may be the worst kept secret ever. I knew about it before I reserved my Model 3 in May '17.

TeslaTap.com | 03/06/2019

Sad that these companies (GM, etc.) just want to produce pollution machines and give lip service to helping the environment. Glad Tesla can benefit from their incompetence.

Not so much of a secret as to numbers - it's been a separate line item in every Tesla financial statement from the start, but less known who is buying them.

andy.connor.e | 03/06/2019

Prime example of a 100 year old company that does not want to change. Refusal for change is guaranteed failure. We should not be expected to bail out General Motors AGAIN.

jordanrichard | 03/06/2019

Though Tesla benefits from this, I don't think companies should be allowed to literally buy their way out of paying hefty penalties for not meeting emissions standards.

blue adept | 03/06/2019

The devil you know....

¯\_(ツ)_/¯

andy.connor.e | 03/06/2019

I'd rather the money go to a company who is making an actual difference, rather than being wasted by our government.

Frank99 | 03/06/2019

Worst kept secret? You could never call it a "secret" of any sort; they reveal the revenue they get from emissions credits in their financial statements, and discuss them in their quarterly calls. The first two hits from Google:
2013: https://www.marketplace.org/2013/05/08/sustainability/teslas-secret-succ...
2017: https://www.forbes.com/sites/greatspeculations/2017/09/01/teslas-lucrati...
a Month ago: http://fortune.com/2019/05/02/tesla-europe-emissions/

Sounds more like Bloomberg making stuff up.

andy.connor.e | 03/06/2019

Blowburg in need of clicks

blue adept | 03/06/2019

@andy.connor.e

I, too, would prefer that the money go to a more deserving cause than helping mask GM's and other companies' CO2 footprint.

David N | 03/06/2019

Not sure what the big deal is, Others have been buyer Tesla credits for many years now. Number might be up due to the number of M3 sales, but this certainly is no secret. More poor journalism.
Other car companies are helping Tesla by the credits.

finman100 | 03/06/2019

As market share of these legacy companies is eroded (by Tesla sales displacing them), plus, they have to pay Tesla in order to continue making obsolete gasmobiles...to continue the eroding. omg that is such sweet justice.

More Tesla's sold versus fewer legacy gassers is a win-win by any measure. THAT sure seems like a losing business plan...for the GMs and Fiats of the world.

wow. pay the competition... to fund the continuing, ongoing success of the VERY thing that is killing your business. just wow.

There HAS to be some pretty loud and angry board meetings in the oil world these days.

tew ms us | 03/06/2019

It's better than a fine that goes to the government to blow.

Ross1 | 03/06/2019

If the Legacies accelerate the demise of Tesla there wont be any credits to buy so then they will be left up the creek.

blue adept | 03/06/2019

@David N

I don't know for certain, but I think that part of the animosity directed towards them is due to the utter disappointment that GM has become for many former, and perhaps even current, fans of theirs due to their betrayal and just being a complete let down.

I mean, think about it...they're noted as being the top auto manufacturer in the world and even managed to show such great promise with their EV1 (which they scraped because it worked too well), even coined themselves as being America's car, and now they're deliberately rigging their ignition switches to kill people (which they covered up for over 10 years by blaming it on the driver bumping the switch with their knee or some other such BS excuse) and paying their chief competitor for credits to offset the harm they're doing to the environment, their customer base and the rest of the world by continuing to produce vehicles powered by toxic fume spewing obsolete technology.

Go figure!

NKYTA | 09/06/2019

On my recent travels, I happened to drive by the Chevy plant in Lordstown, OH (the one Trump was going to save)...saw maybe six cars in a parking lot that holds ~600. A stark reminder.

Tropopause | 09/06/2019

Trump should try to “save” the US auto industry by extending the EV tax credits for GM and Tesla. Otherwise he’s simply allowing the foreign competition to have an advantage.

IMHO Tesla will be fine going forward but what about GM, Ford and Chrysler? Encourage them all to make real EV’s. C’mon, Trump!