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Tesla CEO Elon Musk speaks out against Biden’s EV tax credits

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Yahoo Finance Live's Brian Sozzi, Brian Cheung, and Julie Hyman take a look at Tesla and review CEO Elon Musk's comments about President Biden's infrastructure plan.

Video Transcript

JULIE HYMAN: We'll also see what kind of action we get in Tesla. Now, I just was showing the shares. They are showing a little bit of an indication for a higher open here this morning. But, of course, yesterday came within a hair's breadth of entering a bear market, of closing in a bear market.

The shares are up 51% year to date. They reached a record high on November 4th. And at some point during the session yesterday were down as much as 23% from that record high, but managed to close just down 18%. So, it's still pretty close to a bear market.

This, by the way, as Elon Musk spoke at the Wall Street Journal CEO Council and told the journal, you know we don't need help from the government. He talked about President Biden's plan that would give consumers a tax credit if they buy an electric vehicle that's assembled by union workers using American built batteries. And vehicles made by Tesla, which are not made by union workers, would still qualify for a smaller credit. But he says honestly, I would just can this whole bill. Which is I mean, Tesla, I think you can pretty easily argue particularly in its early days Tesla benefited enormously from tax credits and incentives from the federal and state governments for that matter. But now he's saying we don't need it, Brian Sozzi.

BRIAN SOZZI: Do you see his new haircut, Julie? I think it was pretty cool. He like shaved the side of his head a little more.

BRIAN CHEUNG: It's a little too tight.

BRIAN SOZZI: Yeah.

JULIE HYMAN: Wait, Brian Sozzi.

BRIAN SOZZI: A little too tight.

JULIE HYMAN: You're saying that's pretty cool. I think you will be the only person on the internet to say that. Literally the only person.

BRIAN SOZZI: You can't always be critical of Elon Musk. I like this hair, there's something about. I wish I had enough hair to do that myself. But I know you've been watching his comments at the journal, Julie. I've been looking at reading through a couple of times this feature piece on the company's full self-driving autopilot capabilities by "The New York Times."

Really interesting, fascinating to read. Of course, Tesla continues to be under fire by the National Highway Traffic Safety Administration for what the times is pointing out at least 12 accidents in which Tesla users used autopilot. And we were talking yesterday about it, it's likely that Tesla's stock continues to take its cue from sales numbers and the profits from those sales instead of like what we saw yesterday with that SEC investigation into the solar panels for the company. This is something that might pressure the stock here.

Today, maybe not. But longer term, yes, because one of the reasons you go out there and buy Tesla is because of its full suite of services. It's the performance, it's the giant touchscreen you can play with in the center console. And of course, it is this autopilot feature, which is a very key selling point for Teslas.

BRIAN CHEUNG: You know what was really interesting just to kind of go back to the bigger picture question that was addressed to the head of Tesla there, which was really about the infrastructure bill and just kind of the Biden administration's efforts. He was really taking issue with just the price tag of it. He said that it's unsustainable for the United States to continue to spend that money. But what was interesting was that even though he said he doesn't support subsidies, he wouldn't support the package itself, broadly speaking he does see the need for a big infrastructure change in the United States even with the shift to autonomous driving.

He said that will actually exacerbate traffic across the United States, especially in the major metro areas. It already is a massive problem. So, he was saying that flying cars don't appear to be the solution right now as more autonomous cars get out there and people want to hit the roads, that's only going to make things worse. So, he was suggesting maybe double decker highways or tunnels. As we know, he's been working very hard on the boring project as well. But I think his argument is that it shouldn't be the government that's subsidizing those types of projects, it should be private capital money.

Which, of course, someone of Elon Musk's stature would say that. Even with the EV stations, right? That's a big selling point for the BBB bill as well, which is, well, we can kind of help expand the network of EV stations that are out there. But Elon Musk said, we don't need those government subsidies. It's not like the government subsidizes the proliferation of gas stations around the country as well. So, that's kind of his argument. Of course, I'm sure many Democrats and those on Capitol Hill would argue kind of the opposite. It's not a surprise per se that Elon Musk kind of has these libertarian leaning ideas.

But again, he's kind of saying, look, I just think private money needs to be there. It's not that he's opposing infrastructure improvements per se, just the way about the way about which it's funded. And his haircut, it would look like a DIY kind of big COVID era haircut kind of vibes. It's too tight, it's not really a fade. It's just like--

BRIAN SOZZI: I'm glad I got my razor here. I got my razor out. We're going to do this in the break guys. I'm going to see if I can get this right.

BRIAN CHEUNG: What do you have that doing on your table? You just have that sitting on your table?

BRIAN SOZZI: Working from home, I have access to these things.

BRIAN CHEUNG: OK.

JULIE HYMAN: Times like this I'm glad I'm not a dude. All right, I just want to mention one more thing when it comes to Tesla, as if there's not enough to choose from this morning. So, again , spoke to the "Wall Street Journal", stock almost entered a bear market. We've got that big feature as mentioned in the "New York Times" about the autopilot and how much he had been pushing that technology. The company, then there's also an analyst call that we should mention as well that probably is helping matters this morning when it comes to the stock price. And that's UBS raising its price target to $1,000 from $725.

The analyst there is Patrick [INAUDIBLE] He says the company is likely to continue to beat consensus estimates going into 2022. And he says the company has better access to chips and batteries versus some of its competitors. So, that probably helping matters as well.