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Politics
In a recent development, Elon Musk has denied reports that the US government is planning to spend $400 million on armored Tesla Cybertrucks. The controversy began when the State Department's procurement forecast for the 2025 fiscal year included a line item for "Armored Tesla" cars, which was later edited to simply "armored electric vehicles" after the news broke. This change came as questions about potential conflicts of interest involving Musk's influential role in the White House and his extensive business empire continue to swirl.
Key Facts
Procurement Forecast Change: The State Department initially listed $400 million for "Armored Tesla" cars in its procurement forecast but later revised it to "armored electric vehicles" after the news surfaced.
Denial from Musk: Elon Musk responded to the reports by calling them "fake news" and stating that no one had informed him about such a deal.
State Department Clarification: A spokesperson for the State Department confirmed there are "no current plans" to proceed with the $400 million contract, suggesting the original entry should have been more generic.
Background on Armored Vehicles: The Biden administration had asked the State Department to explore interest in producing armored electric vehicles, but only one company expressed interest in the project.
Conflict of Interest Concerns
The situation highlights concerns about the blurring of lines between Musk's business interests and his role as head of the Department of Government Efficiency (DOGE), an agency tasked with examining government spending. Senator Adam Schiff (D-Calif.) recently sent a letter to the White House inquiring whether Musk would use his position to shield his companies from federal scrutiny. Musk's companies have received $13 billion in federal contracts over the past five years, primarily through SpaceX.
Tesla Cybertruck and Market Impact
The Tesla Cybertruck, which entered the market late in 2023, has been a notable addition to Tesla's lineup. Starting at $79,990, it became the most popular electric pickup truck in the U.S. in 2024, with about 39,000 units sold domestically. Despite its popularity, the Cybertruck accounted for only about 6% of all Tesla vehicles sold in the U.S. last year.
Tesla's stock has experienced volatility recently, partly due to concerns about consumer backlash against Musk's political involvement. However, analysts view these issues as manageable for now.
Source:
Image: A Tesla Cybertruck on display in California in December. (Getty Images)
Author: Derek Saul, Forbes https://www.forbes.com/sites/dereksaul/2025/02/13/elon-musk-denies-us-governments-possible-400-million-deal-to-buy-musks-tesla-cybertrucks-heres-what-to-know