Tesla withdraws application for $1B in subsidies for German factory

electrek.co

12 pointsSnoozus2 comments

How does Subsidies work? I understand Tax Break which is simple enough ( on paper ). And some other forms like ultra low interest capital. But Subsidy implies government actually giving $1B to Tesla with some strings attached ?

> How does Subsidies work? I understand Tax Break which is simple enough ( on paper ). And some other forms like ultra low interest capital. But Subsidy implies government actually giving $1B to Tesla with some strings attached ?

I do not know exactly how this specific IPCEI would have worked, but a lot of EU subsidies used to work in a way that the state covers x% of the cost, usually not more than 50%, in direct payments.

In the past this sometimes lead to strange constructs with licensing fees and companies writing invoices in circles over 2 to 3 business entities to make the state pay for a full 100%. No clue whether they closed these loopholes by now.

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