California Governor Gavin Newsom announced that if President Trump is re-elected next year, he plans to abolish the $7,500 federal subsidy for electric vehicles. California plans to provide subsidies to electric vehicle buyers, but Tesla (TSLA.US) electric vehicles will not receive subsidies.

The Governor's office stated that the new proposal will include market share restrictions, meaning that Tesla's popular electric vehicle models will not receive subsidies. This is to create better conditions for the market and benefit more manufacturers, but the details need to be negotiated with the state legislature.