Elon Musk’s Tesla will be awarded a $400 million contract from the U.S. State Department, the biggest government contract of 2025. The deal, originally valued as a purchase of “Armored Tesla” cars, was subsequently changed to “armored electric vehicles,” the UK Independent reported.
This comes at a time when Musk’s Department of Government Efficiency is under criticism for promoting cuts in spending. Critics contend that giving lucrative government contracts to Musk’s companies while promoting spending reductions is ethically questionable.
Musk, the richest person in the world, justified the deal in an Oval Office interview, asserting that his companies win contracts on merit and for value to taxpayers. “You have to examine the individual contract,” he said, pointing out that his team makes competitive bids. He went on to say that all SpaceX contracts offer the “best value” to the government.
The scandal comes hot on the heels of another recent government contract for Musk’s SpaceX, which won a $38.5 million contract from NASA, further incurring criticism from liberal pundits.
Legal analysts and experts have also raised concerns over possible conflicts of interest. Ex-White House ethics adviser Richard Painter questioned the decision, while lawyer Tristan Snell accused Musk of using cuts to the budget to shut down investigations into his companies while reaping financial gains.
The New York Times also condemned Musk and President Donald Trump for choosing to attack corruption selectively, that the administration is “unwinding anti-corruption efforts while rewarding allies such as Musk.”
Even with the criticism, the contract is still in its planning phase and will be finalized by the fourth quarter of 2025.
