Musk's decision to dismantle the LPO raises concerns about the future of American electric vehicle startups, as it could severely impact the clean energy sector.

Reports indicate that Musk's administration has cut over 60% of the LPO staff, with further reductions expected, undermining the office's ability to support large-scale energy projects.

Despite cuts to the LPO, Musk's other venture, SpaceX, is expected to continue receiving lucrative government contracts, highlighting his dual role as both a benefactor and critic of government funding.

In a significant move, Elon Musk's new initiative, the Department of Government Efficiency (DOGE), has shut down the Department of Energy's Loan Programs Office (LPO), which played a crucial role in Tesla's early success.

The LPO provided Tesla with a pivotal $465 million loan in January 2010, enabling the establishment of its Fremont factory and the production of the Model S.

Originally created to support high-risk energy projects that traditional banks would avoid, the LPO has been instrumental in advancing fields like electric vehicles and nuclear energy.

Tesla recently reported a significant 71% decline in net income, a situation attributed to Musk's controversial management decisions that have negatively affected the brand's reputation.

Critics have labeled Musk's actions as hypocritical, noting that while he benefits from government funding, he restricts future support for other electric vehicle manufacturers that rely on DOE funding.

Energy industry leaders have expressed their worries in a letter to Energy Secretary Chris Wright, stating that the closure of the LPO could slow down essential energy projects and weaken American competitiveness.

The halt in LPO operations has led companies like Kore Power and Freyr Battery to abandon their manufacturing plant plans, citing frozen loans as a critical issue.

Musk's ventures, including SpaceX, have benefited from substantial federal contracts, totaling $38 billion over 20 years, indicating a consistent reliance on government support across his businesses.

Major energy supplier PG&E has flagged uncertainty regarding its $15 billion DOE loan for infrastructure projects, which could result in increased consumer costs.