Tesla soars 14% on the stock market after Trump’s victory

Tesla is taking off on the stock market with gains of around 14%, reaching heights it has not seen since July 2023 on the Nasdaq, and thus celebrating Donald Trump’s victory in the American elections. Protectionist policies and the development of American industry abroad are boosting the company led by Elon Musk – a personal friend of Trump – while they have punished the entire auto sector in Europe.

The market even speculates that the influence that Musk could have, alongside Donald Trump, in choosing the direction of certain government policies, could be very beneficial for the American automobile sector in general, and for Tesla in particular. In fact, rumors suggest that Musk could even take a position in the new Trump administration.

The tycoon promised during the election campaign to the businessman of South African origin to be the new “secretary for cost reduction”, which would give him the power to reduce the weight of civil servants in the public administration of the country.

“Electoral” relationship

In the final months of the campaign, Elon Musk himself donated at least $130 million to the cause. trumpeteralso promoting rallies and publicizing speeches by Donald Trump and his vice presidential candidate JD Vance. He also set the wheels in motion for his field’s social network, X, with countless messages of support for the New York mogul.

In response, Trump proposed import duties of 10% on all foreign-made products and up to 100% on all imported vehicles during the election campaign. A possible firm decision which would initially benefit American manufacturers like Tesla, but also others linked to combustion like Ford or General Motors.

However, while Tesla is experiencing a boom in the electric vehicle sector, which could give the company a clear competitive advantage in a future without subsidies for battery cars, the rest of the manufacturers now expect a boom in against him since January 20, 2025., Trump will be inaugurated again on the steps of the Capitol in Washington.

And this aspect was seen in the stock performance of the rest of the electric car manufacturers in the United States. Rivian Automotive retains more than 9% of the capitalization and Lucid Group – controlled by the Saudi Arabian Sovereign Fund – 4.4%.

Several analysis houses consulted by Europa Press believe that Trump’s victory will be an elixir for Tesla. Wedbush estimates that the shares could add up to $50 to the price per share if, in addition, the autonomous driving system is implemented effectively. Fully autonomous driving from 2025.

However, for Tesla, even if Trump’s arrival in the Oval Office is positive “a priori”, the fact that the Republicans managed to take control of the US Senate, until now in the hands of the Democrats, is not so positive. after obtaining a majority of 51 seats out of 100. In the House of Representatives, the count also offers a clear victory to the Republicans while awaiting the proclamation of the final result.

And Musk is facing right-wing leaders in the country’s Congress, repealing several provisions related to electric vehicles and eliminating emissions and fuel consumption requirements, which could limit Tesla’s revenues generated by the sale of environmental credits to builders who have difficulty complying. the regulations of the Democratic administration.

However, Musk downplayed the threat of a possible reduction in government incentives for electric vehicles, while highlighting the potential for companies to benefit from deregulation.

During Tesla’s quarterly earnings presentation a few weeks ago, Musk even called for accelerated approval of autonomous vehicle technology and admitted that he would “try to get it” if Trump ultimately chose him to take office. position in the new administration.