DOGE Needs a New Strategy After Elon Musk
When I worked as a special agent for the Government Accountability Office, I was assigned to interview an administrative law judge who appeared to be collecting disability payments from Social Security despite his having returned to his federal job after heart surgery. The judge readily admitted to it. I asked why he didn't inform Social Security of his return to work, to which he responded that he had, several times. He had saved the letters and made note of the numerous phone calls too. I asked why he didn't return the Social Security checks, but he said that the payments had been directly deposited into his bank account and that he was ready to return all the money once someone told him how to do so.
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Gizmodo
19 minutes ago
- Gizmodo
After Years of Promises, Tesla Says Its Cheaper Car Is Actually on the Way
For nearly a decade, it has been the holy grail for Tesla fans and the key to its mainstream future: a truly affordable electric car for the masses. After years of promises, delays, and speculation, the company confirmed on Wednesday that the long-awaited cheaper Tesla is finally moving from myth to reality. In its Q2 2025 earnings release, Tesla stated, 'We continue to expand our vehicle offering, including first builds of a more affordable model in June, with volume production planned for the second half of 2025.' This is the most concrete evidence to date that what many have dubbed the 'Model 2' is in production. The confirmation sent a ripple of excitement through the market, suggesting Tesla is finally making good on a promise that dates back to Elon Musk's original 'Master Plan,' written in 2006. The so-called 'Model 2' has long been rumored as a smaller, mass-market vehicle for customers priced out of Tesla's current lineup. Speculation—never confirmed by Tesla—pegs its price at around $25,000, compared to the Model 3, the company's cheapest car, which starts at $42,500. However, the excitement was quickly tempered by the complex reality of Tesla's current business challenges. During the company's earnings call, CFO Vaibhav Taneja revealed that the rollout will be slower than initially hoped. The reason? A strategic choice to prioritize a last-minute sales blitz of its more expensive models before the $7,500 federal EV tax credit expires on September 30th. 'We started the production of the lower-cost model as planned in the first half of 2025,' Taneja told analysts. 'However, given our focus on building and delivering as many vehicles as possible in reverse, before the EV credit expires and the additional complexity of ramping a new product, the ramp will happen next quarter slower than initially expected.' Elon Musk provided a slightly more optimistic, if still distant, timeline, telling analysts, 'We'll be running with the more affordable models available for everyone in Q4.' He also sought to reassure investors that affordability would not come at the expense of profitability. 'The goal with those products was not to negatively impact revenue or gross margin, but just to make a car that everyone loves and wants at a more affordable price,' Musk said. Many Tesla fans were disappointed and quickly voiced their frustration on X, Musk's social platform. 'I don't understand why they are delaying it. Could they not initially sell it in other countries. Then it would show people in the US they can get a better car in Q3 for the same/better price as the cheaper car in Q4,' one user said. I don't understand why they are delaying it. Could they not initially sell it in other countries. Then it would show people in the US they can get a better car in Q3 for the same/better price as the cheaper car in Q4. — Craig Mouser (@mouser58907) July 24, 2025For a long time, Tesla's enormous market capitalization was based in part on the fact that the carmaker would produce a car that millions of people could afford. Last year, Musk suggested that Tesla had shelved its plans for an affordable model. The arrival of a cheaper Tesla could be a game-changer, unlocking a vast new market of buyers who have been priced out of the EV revolution. A successful launch could help Tesla combat slowing sales and increasing competition from Chinese automakers who have flooded the market with low-cost EVs. But major questions remain. While the company has not revealed official pricing or specifications, Musk offered a clue about the car's identity during the call, seemingly putting an end to years of 'Model 2' speculation. When asked about the new model, Musk quipped, 'It's just a Model Y. Let the cat out of the bag there.' This suggests the affordable car will be a simplified or stripped-down version of its best-selling SUV, rather than an entirely new vehicle built on a different platform. It's a more affordable take on the company's best-seller. 'I bet it uses the same body with scaled back features,' said Gene Munster, analyst at Deep Water Management. 'This is just like Apple does with the iPhone. But if it really looks just like the Y, it will cannibalize the Y. I have to think more about that trade off.' Musk says the new affordable model will 'look just like the Model Y.' My take: I bet it uses the same body with scaled back features. This is just like Apple does with the iPhone. But if it really looks just like the Y, it will cannibalize the Y. I have to think more about that… — Gene Munster (@munster_gene) July 23, 2025Still, the 'slower ramp' means that by the time this cheaper Model Y is available in significant numbers, the federal tax credit that could have made it even more affordable will be long gone. For Tesla, the stakes are enormous. Delivering a successful, profitable, mass-market vehicle would fulfill a core part of its founding mission. But after years of waiting, the company must now prove it can execute on its most important promise yet, all while navigating a more challenging and competitive landscape than ever before.
Yahoo
42 minutes ago
- Yahoo
Crowded by EV Rivals, Tesla Preps For Critical Earnings Report
For what feels like the third or fourth time in a row now, Tesla is gearing up for what may be the most important earnings call in its history. The electric vehicle maker reports after the bell today, holding its first call with analysts and investors at the dawn of a new era that finds the company squeezed between increased competition and a high-stakes feud involving its enigmatic CEO and the US federal government. At stake are billions in lucrative tax credits. Buckle up, things could get pretty bumpy. READ ALSO: Tariffs 'The World Can Live With': US-Japan Trade Pact Pushes Markets to Record Highs and Amazon, Meta Wear AI-mbitions on Their Wrists Credit Score After something of a shareholder mutiny earlier this year sparked by his divided attention while serving as an aide to President Trump, Elon Musk has seemingly quelled the critics. Now, Tesla must confront its myriad headwinds. First and foremost: The regulatory credits Tesla sells to combustion-engine carmakers to offset their tailpipe emissions. Selling the credits has been big business for Tesla, generating more than $10 billion in revenue since 2019 and accounting for a substantial portion of its free cash flow in 2024. Recent legislation, however, eliminates the hefty fines that traditional automakers face for failing to reach emissions standards, thus reducing the demand for Tesla's carbon credits. Tesla's credit sales already dipped in the first quarter, generating revenue of just $595 million compared with $692 million in the final quarter of 2024. Analysts at William Blair and Co. recently projected that revenue in the category might fall by 75% next year, and be virtually eliminated by 2027. Analysts at Piper Sandler, meanwhile, are slightly more bullish, recently projecting that 'Tesla will still book around $3B in credits this year, followed by $2.3B in 2026.' Many legacy automakers have long-term contracts for carbon credits from Tesla. Still, those same legacy automakers are suddenly catching up to Tesla in the EV realm: While Tesla remains the EV king in the US, its sales are shrinking just as rivals' are growing. The Automotive News Data Center estimates that Tesla sold 125,000 EVs in the US in the second quarter, down almost 17% year-over-year (Tesla doesn't break down its delivery figures by region). GM, meanwhile, reports that it sold 46,280 EVs in the second quarter and 78,167 EVs so far this year, representing a 111% increase from 2024. That puts GM's domestic EV market share at around 13%, while most estimates peg Tesla's once-dominant US market share at just 43% now. 'GM is quietly building trust while Elon burns it,' Paul Waatti, director of industry analysis for AutoPacific, recently told USA Today. Bleep Bloop: Still, Tesla has a sky-high forward price-to-earnings ratio for a reason. Thus far, at least, Musk has been able to sell investors on a future of self-driving cars and robotics. A robotaxi pilot program launched in Austin, Texas, earlier this summer. 'Outside of guidance, the market will likely be focusing on the robotaxi business, which had to navigate a slew of weather problems,' David Wagner, head of equity and portfolio manager at Aptus Capital Advisors, told The Daily Upside. 'The company has a 'hopes and dreams' multiple, so anything focusing on [autonomous vehicles], robotics and the other innovative products should be the focal point.' This post first appeared on The Daily Upside. To receive delivering razor sharp analysis and perspective on all things finance, economics, and markets, subscribe to our free The Daily Upside newsletter. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
USA Today
an hour ago
- USA Today
Two-income retired couple may lose $18,100 annually in Social Security in 2033
A dual-earning couple retiring at the start of 2033 can expect an average $18,100 lower annual Social Security benefit than if they retired now, according to a new analysis from the Committee for a Responsible Federal Budget. The 24% drop is expected to come just after Social Security's Old-Age and Survivors Insurance (OASI) Trust Fund is depleted. OASI holds money collected from payroll taxes to help fund Social Security. That fund is expected to be depleted by late 2032 as the number of retired people outpaces the number of workers. Once OASI's depleted, Social Security benefits will no longer be paid at the full rate. Instead, benefits will be cut, only payable by the amount of money coming in. Even worse, "the cuts would grow over time as scheduled benefits continue to outpace dedicated revenues," the nonprofit CRFB said in its analysis. By 2099, the size of the required benefit cut would grow to well over 30%, it said. Here's how cuts could affect Americans The $18,100 annual cut is an average for a two-income couple. Depending on a couple's age, marital status, and work history, the actual size of the benefit cut would vary. Here are some examples of how Americans could be affected, in nominal or non-inflation adjusted terms, CRFB said: How many Americans could be affected? In June, nearly 67 million Americans received Social Security, according to the Social Security Administration. Social Security is deemed important by 96% of Americans in 2025, with little difference among age groups and political party affiliation, an AARP survey of 3,599 adults ages 18 and older taken last month showed. AARP is a nonprofit advocating for older Americans. Nearly two in three retired Americans say they rely substantially on Social Security, while another 21% say they rely on it somewhat, AARP said. CRFB vs Social Security and Medicare Trustees The CRFB's estimates of a 24% cut in seven years is more dire than the 23% drop in eight years provided by the Social Security and Medicare Trustees report in June. That's because CRFB accounts for the impact from the One Big Beautiful Bill Act (OBBA) signed into law over the Fourth of July, the think tank said. "The tax rate cuts and increase in the senior standard deduction from the recently enacted OBBBA would reduce Social Security's revenue from the income taxation of benefits, increasing the required cut by about a percentage point upon insolvency," CRFB said. "If the expanded senior standard deduction and other temporary measures of OBBBA are made permanent, the benefit cut would grow larger." The OBBBA's $6,000 extra senior deduction is slated for 2025 through 2028. What can government do to keep 100% benefits flowing? Congress will have to increase revenue coming into the program by possibly raising payroll taxes, reducing overall spending on benefits maybe by raising the full retirement age, or some combination of the two, AARP suggested. Also, eliminating the maximum income that's taxable for payroll tax and reducing the benefits paid on higher earnings are also among steps Congress could take to save money, the CRFB said. Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.
