Elon Musk said that Norway should not take offense to Tesla

Tesla's US Tax Credit Set To Come To An End | OilPrice.com

A Tesla spokesman confirmed that the company delivered its 200,000th vehicle in the USA this month, so the full $7,500 tax credit will remain in place until December 31. China already is Tesla's No. 2 market after the United States. But on Thursday, news broke of harsh conditions at the firm's factory in Fremont, California, showing Tesla's desperation to ramp up production.

"Tesla is deeply committed to the Chinese market, and we look forward to building even more cars for our customers here", the company said in its emailed statement.

The automaker has now sold a total of over 200,000 electric vehicles in the US, which means that that the $7,500 federal tax credit that its cars have been eligible for will begin to phase out on January 1, 2019, when it drops to $3,750, followed by a further reduction to $1,875 on July 1 and its full elimination at the end of the year. Last year, more than 28 million cars were sold, and annual sales are forecast to top 35 million by 2025. Then it will halve to $3,750 for the first half of 2019 and halve again for the second half.

Besides the import tariffs and the shipping costs Tesla effectively sidesteps by breaking ground in China, the EV maker also stands to save money in terms of sourcing, as many raw materials needed to build a Tesla, such as rare earth metals, are mined and processed for manufacture in China. There are still state-level incentives available, however, which Tesla has also laid out on its site. But as Musk neared a deal with Google CEO Larry Page, Tesla started selling enough vehicles to become financially stable, and Musk made a decision to keep Tesla independent.

Electric auto pioneer Tesla Inc. The government was planning to bring that down, but instead raised it to 40 percent for USA built vehicles in retaliation to the Trump administrations tariffs that went into effect last week.

Tesla sold 14,779 vehicles in China a year ago, according to data from LMC Automotive. CEO Elon Musk, for one, noted on Twitter that the Model 3, while newer than the Model S, is not a superior vehicle.

There's no guarantee that the trade war will still be raging in a few years when the factory begins production, but local manufacturing hedges against future trade barriers. Once installed in a Tesla vehicle, it gets shipped back to Asia to reach customers there.

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