Musk Calls Out California ARB for ‘Pathetically Low’ Zero Emission Credit Standards

CEO Elon Musk went on a bit of an offensive rant over California’s stance toward its zero emission vehicle credit program during the Tesla shareholder call on Wednesday.

In what was reported as an unusual “public tirade,” Musk bore down upon the California Air Resources Board, saying the standards need to be raised. The ARB requires automakers to sell electric and fuel cell vehicles in proportion to their market share in the state. Companies that exceed the standards, such as Tesla and Nissan, can sell their extra credits to automakers that don’t reach their marks.

“The California Air Resources Board is being incredibly weak in its application of ZEV credits,” Musk said on an earnings call. “The standards are pathetically low. They need to be increased. There’s massive lobbying by the big car companies from increasing the ZEV credit mandate, which they absolutely damn well should. CARB should damn well be ashamed of themselves.”

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In the last quarter, Tesla reported $57 million in ZEV credit revenue. But this quarter, ZEV credits were small enough that Tesla didn’t break them out.

Automotive analyst Alan Baum noted Musk was essentially saying what he did in the interests of his company.

“Obviously, stronger regulations are helpful to Tesla because it increases the amount and value of the credits they can sell,” said Baum. “In addition, he is of course committed to vehicle electrification so efforts to increase regulation are consistent with his goals.”

California is expected to issue a report on how the ZEV mandate is working out in the fourth quarter of 2016. Representatives for the board didn’t immediately reply to e-mailed requests for comment.

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