California Denies SpaceX Subsidy Request - Is Musk's Government Gravy Train Coming To An End?

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by Tyler Durden
Saturday, May 16, 2020 - 10:00 PM

California is taking a swipe back at Elon Musk.

A state panel voted on Friday to reject Musk's request for $655,000 in job and training funds for SpaceX, citing the CEO's recent bizarre behavior and threats to move Tesla out of state. 

We have been documenting Musk's threats to move out of California and the CEO's supposed plans to take his operation to Texas or Nevada instead. 

Five members of the panel voted against the proposal and two voted for it. The California’s Employment Training Panel openly discussed the CEOs Tweets and media reports about layoffs at SpaceX's Hawthorne headquarters, according to Reuters

Gretchen Newsom, a panel member and the political director of an IBEW electrical workers union local, said: “In my opinion, given the recent threats of the CEO to leave the state of California, and everything else we’ve discussed today, this proposal does not rise to the level for me to feel secure in supporting it.”

“SpaceX is a different company, but they have the same CEO,” she concluded. 

Tesla and SpaceX remain non-union shops. Funding from the state was supposed to help SpaceX train 900 new employees for its Starlink satellite project and hire an additional 300 to work on its Starship program. It's unclear whether or not SpaceX will move forward with the hiring without the state aid.

Recall, this past week, longtime Tesla fans turned against the company as many accused Musk of placing Tesla's share price - not to mention his own personal gain - above the safety of his workers.

After President Trump spoke out in Musk's defense, Alameda County folded and Musk mostly got his way about re-opening his plant.

But apparently, the bad taste that the incident left in Musk's mouth prompted him to leak a story about Tesla picking Austin, Texas as the site of its next Gigafactory. Tesla has four gigafactories - Sparks, Nevada, Buffalo, New York, Shanghai, China and one under construction in Berlin.

Hopefully other U.S. states follow California's lead and decide to cut Musk's gravy train off. It sure would be tough for Tesla to operate with demand and production at coronavirus lockdown-levels - and without the help of ZEV credits or government subsidies...