Despite the occasional stock market rally, Tesla is clearly struggling. The EV company, once the crown jewel of its industry, has seen steep declines over the past year, as its CEO, Elon Musk, continues to draw criticism over his political activities. Sales for the company are down all over the world, despite its recent introduction to new markets, like India. Now, as Tesla struggles to keep its head above water, another significant revenue stream is about to run dry, thanks largely to Musk’s former “buddy,” President Trump.

On September 30th, the EV regulatory credit is set to expire. The program, which has allowed gas-powered vehicles to sidestep federal fines linked to the pollution they create, has served to enrich a small number of electric vehicle producers, most notably Tesla. To avoid federal fines over pollution (the government has incentivized EV production by fining firms that fail to produce a certain threshold of zero-emission cars), traditional car companies can purchase “credits” from EV makers like Tesla, which allows them to stay within compliance.

For years, the EV regulatory credit has provided Musk’s company with a financial lifeline. Indeed, according to an E&E News analysis of Tesla’s securities filings, the company has earned over $10 billion from the scheme, a third of the company’s total profits over the last decade. Reuters reports that such credits are currently “crucial for Tesla’s finances” and that they have represented the “main driver” of the company’s profits during the first quarter of 2025. In that sense, despite its supposed mission of making the world a healthier place, Tesla has ironically helped to incentivize the continued production of gas-guzzling, emissions-producing cars, as the EV credits scheme has allowed many of the big-name automakers to continue on with business-as-usual.

The regulatory credits seem to have gotten Tesla through some tough times in the past, including in 2019 when, according to Musk, the company was nearly forced to file for bankruptcy.

Of course, that’s all over now. Trump’s One Big Beautiful Bill included a provision that nixed the regulatory credit program, stating that it wanted to “eliminate the ‘electric vehicle (EV) mandate’ and promote true consumer choice.” It is largely believed that this single issue (which Musk obviously understood as a threat to his business) is the reason that the tech billionaire left the White House and has proceeded to feud with the president, taking any opportunity he can to highlight Trump’s former ties to Jeffrey Epstein.

When will the EV credit party come to an end? Reuters cites an independent review by analysts at William Blair:

Within days of the new law, they slashed estimates for Tesla’s 2025 credit revenue by nearly 40% to about $1.5 billion. They expect it to plummet to $595 million next year, before being wiped out in 2027.

Taking shots at Trump won’t pull Tesla out of a nosedive, however. In an attempt to stave off a further collapse of its business, Musk’s company has made a series of increasingly desperate maneuvers. Recently, it began to roll out a variety of special offers to drivers, many of which would have been unthinkable only a couple of years ago. There’s not a whole lot of evidence that the company’s efforts are panning out so far. Reuters reported Tuesday that, in California (once the hub of Tesla’s popularity), sales were down for the seventh consecutive month. Tesla’s 2nd quarter earnings report is expected to bring more bad news.