Vidak: AB 1184 -- A $3 billion subsidy for Tesla and the millionaires who buy them?

Friday, July 7, 2017

Sacramento – Senator Andy Vidak (R-Hanford) recently voted against Assembly Bill 1184 (authored by Phil Ting, Democrat from San Francisco).  AB 1184 would spend $3 billion in state funds to help millionaires get discounts when they buy an all-electric car, primarily ones made by Tesla.  The measure was approved 7-2 by the Senate Energy, Utilities & Communications Committee.

“Now the state appears to be in the business of subsidizing a billionaire’s company (Tesla) and millionaires who want buy these boutique electric cars,” stated Vidak.  “In my back yard, where I live, people are very, very poor, and they are already paying into Cap and Trade. If Cap and Trade continues to go forward… that could add another 40 cents, 45 cents, maybe more (to the cost of a gallon of gasoline), for those folks you are saying are not rate payers, but yet, they are still not going to be able to afford these ($70,000+) cars.”

The alleged goal of AB 1184 is to encourage people of less means to be able to buy an electric car instead of a normal combustion engine vehicle.  However, critics of the scheme point out there is no “means test” in AB 1184, meaning that anyone, regardless of how wealthy they are, will get a rebate of up to $30,000 to $40,000 from the state for buying an all-electric car (i.e., a Tesla).

Critics also cite a July 3 Los Angeles Times article (“More factory problems as Elon Musk’s Tesla starts producing the Model 3”) as perhaps the real reason for AB 1184.  The story mentions Tesla company stock dropping amid problems the billionaire owner is having producing electric cars cheap enough for anyone but millionaires to buy.  And a July 6 USA Today article (“Despite bumps in road, hybrid cars are still powering on”) says the market for pure electric cars is “shaky.”

As if by coincidence, AB 1184 is written so that the subsidy/rebate program is limited to purely electric cars.  Hybrids (which use gas and batteries), hydrogen-powered cars and other alternative vehicles need not apply.

“Electric car companies are having trouble making it in the market-place without heavy government subsidies,” said Vidak.  “So they propose this law to not only boost their sales but also to ace-out their competition.  The Legislature is once again picking winners and losers in what is supposed to be a free-market.”

Vidak also tore into some of the coastal elites backing AB 1184 when they mentioned that “electricity is cheap,” ignoring the fact that electricity and gasoline prices in the Central Valley are some of the highest in the nation.

“Well electricity is not cheap. This state, after we add a little bit more, will be the highest. So anybody that says that electricity is cheap, probably has a lot of money, and probably doesn’t live where it gets hot or it gets cold… This is going to come back to the poorest of the poor, again paying for something that they will not benefit from.”