Tesla is one stock that’s likely to be impacted by the outcome of this week’s biggest event: the U.S. Presidential Election.
Shares of Tesla stock jumped 4% in morning trading.
Tesla’s CEO, Elon Musk, is closely tied to Trump, having made huge donations to his campaign, while he has shown his support both out in the field and on X, the social media platform he owns.
However, Trump is known for his critical stance on the EV industry. While he owes Musk a debt of gratitude for his support, the question remains: what would a Trump victory mean for the EV industry as a whole, and for Tesla specifically?
Wedbush analyst Daniel Ives thinks one might not necessarily be tied to the other.
“We believe a Trump presidency would be an overall negative for the EV industry as likely the EV rebates/tax incentives get pulled, however for Tesla we see this as a potential positive with some caveats,” Ives noted.
Tesla’s unmatched scale and reach in the industry could provide the company with a “clear competitive edge,” especially against a backdrop of no EV subsidies. Additionally, anticipated higher tariffs on Chinese imports could further limit the influx of affordable EVs from Chinese companies like BYD and Nio, helping Tesla hold on to its leading position in the U.S. market.