Tesla Inc. may be excluded from consumer rebates for electric vehicles under a new proposal by California Governor Gavin Newsom, signaling a potential conflict with Tesla CEO Elon Musk. Newsom’s plan aims to reinstate state-level rebates for EV buyers in response to President-elect Donald Trump’s anticipated rollback of the federal $7,500 EV tax credit.

The proposed rebates would revive a program California phased out in 2023, but Tesla’s popular models, including the Model 3 and Model Y, would not qualify under the new guidelines. Newsom, the Democratic leader and possible 2028 presidential candidate, could face backlash for excluding one of the state’s most prominent automakers.

Meanwhile, Musk’s Republican ties may add further political weight to the debate over state and federal EV incentives.