Recent reports have highlighted a proposed $400 million contract by the U.S. State Department to purchase armored electric vehicles, initially specifying Tesla as the supplier. This plan has been met with scrutiny due to potential conflicts of interest, as Tesla’s CEO, Elon Musk, holds a significant advisory role in the current administration.
In January 2025, U.S. President Donald Trump established the Department of Government Efficiency (DOGE) through an executive order, appointing Elon Musk to lead the initiative. Despite its acronym, DOGE is not a formal federal executive department but operates as a task force aimed at modernizing federal technology and reducing government expenditures.
DOGE’s aggressive approach has led to significant actions, including scrutinizing the Department of Defense’s budget, seeking access to sensitive IRS data, reducing funding for the National Institutes of Health’s administrative functions, and implementing widespread federal workforce layoffs. These measures have sparked controversy and criticism, particularly regarding potential conflicts of interest and the centralization of power under an unelected entity.
The U.S. State department plans to buy armored Tesla vehicles. Elon Musk, who is leading efforts to cut government spending, has won more than $13 billion in government contracts in the past five years.
Trump administration says it has no plans to fulfill $400 million ‘armored Tesla’ contract for now.
Update – The State Department said Thursday it is abandoning plans of purchasing $400 million worth of armored Tesla vehicles after a public document detailing federal contracts for fiscal year 2025 gained wide attention.
That expected purchase of Teslas, which was slated for September of this year, is now on hold, according to the State Department, which now says it has no plans of fulfilling the contract.
The potential federal purchase drew scrutiny since Tesla Chief Executive Elon Musk is also a top White House official who has been leading the Department of Government Efficiency, a unit focused on shrinking the federal workforce and ferreting out corruption.
The document did not specify what EV vehicles would be purchased by U.S. officials, however Tesla’s Cybertruck, with its militaristic design and stainless steel exterior, would have been the only EV vehicle that would qualify.
On February, 12, after reports circulated Wednesday night of the State Department’s intent to purchase Tesla vehicles, NPR noticed that the document was edited, at 9:12 p.m., to say the federal contract is for $400 million worth of “armored electric vehicles,” but the word “Tesla” was removed.
Responding to a segment by MSNBC’s Rachel Maddow about the $400 million contract, Musk wrote on X on Wednesday night: “Hey @Maddow, why the lie?”
The Tesla contract started in the Biden administration “to explore interest from private companies to produce armored electric vehicles,” a State Department spokesperson said on Thursday.
Tesla was the only company to express interest in the department’s request at the time.
Typically the next step would be “an official solicitation” for vehicle manufacturers to compete for the contract. But now, the solicitation is on hold, according to the State Department spokesperson.
Musk, who spent more than a quarter-billion dollars to help elect Trump, has used an X account devoted to DOGE to highlight what he views as excessive or unnecessary federal contracts.
As Musk’s deputies have gained access to nearly two dozen federal agencies, ethics experts have raised concern about the billionaire running into conflicts of interest, since Musk runs six companies, some of which are under investigation by government authorities. Musk’s companies, including Tesla and SpaceX, also have multibillion-dollar contracts with the federal government.
Most of the federal money Musk has received has gone to SpaceX, the rocket company, for projects including work for NASA to launch Musk’s Starship with astronauts to the moon.
The Cybertruck MSRP starts at $79,990. The truck, which was unveiled in 2019 and began deliveries in 2023. Cybertruck owner’s have had many complaints about the truck.
The State Department document also shows that some Tesla competitors are set to receive lucrative, yet considerably smaller, contracts for armored vehicles, including from BMW, which is expected to supply about $40 million worth of SUVs to the federal government.