California Governor Gavin Newsom has announced plans to reinstate state-level electric vehicle (EV) rebates if the incoming Trump administration eliminates the federal EV tax credit. This initiative aims to maintain support for EV adoption within the state.

Notably, the proposed program may exclude major manufacturers like Tesla to encourage competition and innovation among smaller EV producers.

Tesla CEO Elon Musk has criticized this potential exclusion, highlighting that Tesla manufactures its EVs in California. He described the move as “insane” on social media.

California has been a significant market for Tesla, with the Model Y being the top-selling vehicle in the state. However, Tesla’s market share in California has declined this year, which some attribute to Musk’s controversial political views and support for Trump.

The specifics of the proposed rebate program, including the criteria for manufacturer eligibility, are still under negotiation with the California Legislature. The program is expected to be funded by the state’s Greenhouse Gas Reduction Fund.