Tesla's Elon Risk 1.0
First, I’m still a $Tesla Motors(TSLA)$ shareholder.
Last time I said a few "Musk Risk Points" about TSLA after the surge - What is Tesla's Elon Risk?, the core of which is, once Elon Musk is in politics, there will beThe core is that once Elon Musk is in politics, there will be a situation that "water can carry a boat and it can also overturn the boat", Trump's power can push up Tesla's stock price, but it can also bring risks when it is targeted.
For example, for electric car subsidies, Tesla has been "artificially" excluded.
On November 25, California Governor Gavin Newsom (the most competitive Democratic presidential candidate in 2028) proposed a new EV subsidy program designed to provide state subsidies to EV buyers in lieu of the $7,500 federal tax credit that could be eliminated by the Trump administration.
But the exclusion of Tesla from the program sent TSLA stock plummeting more than 4% in the Nov. 24 session.
Implications for Tesla
Opportunities for competitors.Newsom's proposal is intended to create fairer market conditions, allowing other EV makers to gain more market share.Tesla's exclusion would benefit traditional automakers such as $Ford Motor (F)$ $ $General Motors (GM)$, who cansubsidized to lower their selling prices, thus attracting more consumers.
Further compression of market share.Tesla currently has over 50% of the California EV market share, but its sales have declined as competition in the market has intensified.Tesla's sales in the first three quarters of 2023 were down 12.6% year-over-year.If Tesla is excluded from subsidies, this could lead to a further reduction in its market share.
Concerns about earnings instability are once again amplified.Investor concerns about Tesla's future profitability are likely to be amplified here, with the current trend of volatility in the EV industry not gaining traction, and a fuller commercialization of Tesla's FSD hitting investor expectations even harder in the long run.As investors focus more on earnings pressure, the stock will continue to be pressured.
Policy Context and Corporate Relations.The relationship between Tesla and the California government has been tense, with Musk having moved his headquarters to Texas due to his dissatisfaction with California politics.The move not only reflects friction between the company and local governments, but could also affect Tesla's brand image and consumer loyalty in California.
But it could also be an opportunity for a Tesla deal at the same time.
My view is that up and down swings in Tesla over the next period of time will likely become frequent; investors looking for higher yearly returns by betting on Tesla before the end of the year will likely continue to opt for the upside, after all, the other big tech companies have benefited YTD.
Yesterday's session also December 6 to options large orders, the strike price of 347.5, in fact, this fluctuation is not big for Tesla, but investors may think that this week or two tends to be more "oscillating upward".
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