Tesla stock rose Tuesday as a video showing a driverless Tesla vehicle on the streets of Austin, Texas added to expectations that the company’s robo-taxi service isn’t far away.
Shares of the electric-vehicle maker gained 5.7%, closing at $326.09, near the highs of the day, while the S&P 500 and Dow Jones Industrial Average gained 0.6% and 0.3%, respectively. Tuesday’s gains put Tesla’s market value back above $1 trillion.
A video on social media showed a driverless car, apparently without humans inside, operating in Austin. Tesla didn’t respond to a request for comment, but CEO Elon Musk commented on several posts on X, praising the design of Teslas and his company’s approach to self-driving cars.
Tesla’s robo-taxi service is based on unmodified Tesla vehicles that anyone can buy, Musk said Tuesday. He also predicted that other auto makers would eventually license Tesla’s self-driving technology.
“As Tesla robo-taxis become widespread and [auto makers’] solutions don’t work, they will naturally turn to us,” said Musk.
The driverless vehicle helped the stock brushed off a warning from Wells Fargo analyst Colin Langan, who wrote that the company was on track for another weak quarter of car sales. Through May, North American deliveries were down 13% year over year, based on data from industry providers Langan tracks. European deliveries were off 42%. Chinese deliveries fell 22%.
Wall Street projects second-quarter deliveries of about 412,000 cars, according to FactSet, down 7% year over year. That might be optimistic. Weaker-than-expected deliveries can create profit margin pressure, Langan adds. He rates Tesla stock at Sell, and has a $120 price target.
It’s a concerning update, but investors have other things on their minds besides the car sales. In addition to the robo-taxis, politics are still weighing on investor sentiment.
Tesla stock traded as low as $281.85 on Monday but closed at $308.58, up 4.6% on the day. Shares rallied late after President Donald Trump wished Musk well and said he would be willing to speak with the Tesla CEO. That came after Musk appeared to support the president’s policy regarding the Los Angeles protests, responding to a post from Vice President JD Vance with two American flags. Musk also reposted comments from the president that were critical of California Gov. Gavin Newsom.
Shares of the EV maker fell 17% in the space of two days last week after disagreements between Musk and the president descended into a war of words on social media. At Tuesday’s close, Tesla stock had recovered about 70% of the feud-related losses.
Tesla shares closed just north of $344 on June 3, the day before things got strange.
Now, investor attention turns to Tesla fundamentals, namely the self-driving taxi service. Optimists about the stock believe autonomous vehicles could unlock a new era of growth for the company.
Coming into Tuesday’s trading, Tesla stock was down about 24% year to date but up almost 75% over the past 12 months.
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