Elon Musk on stage in front of Republican presidential candidate former President Donald Trump speaks at a rally at Madison Square Garden in New York, New York on Sunday, October 27, 2024.
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shares Tesla The electric car maker's shares rose more than 9% in Friday afternoon trading, pushing the electric car maker's market value past $1 trillion.
The company's shares rose by about 27% this week after Donald Trump won the US presidential elections and investor optimism increased that the former leader's return to the White House could benefit Tesla. Tesla CEO Elon Musk was a key ally of Trump throughout his campaign, pouring at least $130 million into pro-Trump campaign efforts.
Tesla's market cap was $807.1 billion as of Tuesday's close. Before this week's rise, the automaker's shares were up about 1% for the year. Tesla stock is now up roughly 29% year to date.
Tesla rejoins a growing club of technology names now worth more than $1 trillion, including… Nvidia, apple, Microsoft, alphabet, Amazon and dead (Although all but Meta are worth over $2 trillion). Tesla's market cap first crossed the $1 trillion mark in October 2021.
A potential Trump administration could create less regulation for Tesla and other companies, said Wedbush Securities analyst Dan Ives.
“Tesla has unparalleled scale and scale in the electric vehicle industry, and this dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled with potentially higher Chinese tariffs that will continue to keep out cheaper Chinese EV companies. ( BYD, Nio, etc.) will likely flood the US market over the coming years,” Ives wrote in a note to clients this week.
Trump previously said he might cut the $7,500 federal tax credit for electric vehicles. These credits have historically helped increase Tesla car sales.
In its latest earnings update, Tesla reported revenue of $25.18 billion and net income of $2.17 billion in the third quarter.
CEO Musk said on the earnings call that his “best guess” is that “vehicle growth” will reach 20% to 30% next year, due to “low-cost vehicles” and “the emergence of autonomy.”
Tesla has been promising and developing self-driving vehicle technology for more than a decade. Its main US competitor, Alphabet-owned Waymo, has already stepped up and begun operating commercial robot services in several major cities.
On the third-quarter call, Musk said he would use his influence with the Trump administration and Vance to create a “federal approval process for autonomous vehicles.” Currently, approvals are done at the state level, which the CEO sees as a regulatory hurdle Tesla will need to overcome once it finally offers more than partially automated driving systems.
— CNBC's Laura Kolodny contributed to this report.
Correction: This story has been updated to correct the year Tesla's market cap surpassed $1 trillion for the first time. Tesla's net income was $2.17 billion in the third quarter. An earlier version misstated this number.
