In 2019, Tesla made $1.79 billion in regulatory credit sales due to the failure of its rivals to sell enough electric vehicles. Environmental standards regulate businesses in the US, Europe, and China to meet emission requirements. The company’s income from these sales has totalled almost $9 billion since 2009, according to Bloomberg.
Recently, Tesla predicted that regulatory credit sales would dry up but this was disproved by the revelation that the company’s earnings from these sales are slowly increasing. Despite facing competition from electric vehicle manufacturers such as BYD in China, which overtook Tesla as the world’s top seller of EVs early in the year, Tesla’s rivals are scaling back their EV plans. This has led to an increase in sales and profits for Tesla from regulatory credits. The company did not respond immediately to requests for comments made by Business Insider.