Yeah it is a super dumb excuse. The real reason is this:
> Our IT team is going to have to do some work and expose that traffic is sent unencrypted (or differently encrypted) to the final hop on the network.
I get why IT teams don't want to, especially for huge organizations, but "lol we can MITM TLS" is not acceptable. Terminate the exterior TLS at the network, inspect / log it, then re-black it to the end device.
Also, I want to take a second to complain about locally installed certs. I know we all know how they work and everything, but most users don't. The fact that I can see a green lock for google.com when Eve has put a local cert on my machine is really stupid.
People check their personal email on their work computers, that's just a fact of life. Their personal email password shouldn't be in some network log somewhere without them understanding that this is possible. There should be a different colour for when trust is different. A blue lock, for example. I know IT has root anyway, but most companies don't install key loggers on their gear or do obviously shady shit, and I think it would benefit users to have a clear demarcation about who they are trusting.