Tesla shares look set to open at the highest levels in more than a year Wednesday following what appears to be a decisive victory for former President Donald Trump in the 2024 elections.
Elon Musk has been a vocal and high-profile supporter of the former president's campaign, raising millions of dollars through his political action committee and appearing at key campaign rallies throughout the autumn.
The Tesla (TSLA) CEO could now be in line for a key role in the Trump administration, possibly heading what some have called a 'government efficiency commission' aimed at lopping hundreds of billions of spending from the federal budget.
Trump also spoke in glowing tones during an address to his supporters in Palm Beach, Fla., late Tuesday, calling him a "new star" in the Republican Party and a "super genius" that needs to be protected.
He also praised Musk's effort on the campaign trail and his willingness to deploy the Starlink satellite internet service in North Carolina following Hurricane Helene.
“He’s a character, he’s a special guy, he’s a super genius,” Trump said. “We have to protect our geniuses; we don’t have that many of them.”
A Trump administration is also likely to revamp the broader electric-vehicle landscape by imposing stricter tariffs on cars made overseas and removing some of the tax credits and rebates that have unpinned the profit potential for newer market entrants such as Ford Motor (F) and General Motors (GM) .
Tesla, however, with its large and established manufacturing facilities in the U.S., could provide the group with an edge over its domestic rivals, argues Wedbush analyst Dan Ives.
Tesla has 'unmatched scale' in EVs: Wedbush's Ives
"Tesla has the scale and scope that is unmatched in the EV industry and this dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players from flooding the US market over the coming years," he said.
Ives also sees a new Trump administration as potentially fast-tracking some of the self-driving initiatives that Tesla is relying on to power its near-term growth should Republicans maintain control of the House of Representatives.
"The autonomous fast tracking will be front and center for investors in this scenario as some of the 2026/2027 goals for Tesla could be accelerated to stay on track with the China timeline for autonomous currently underway," he said.
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Musk told investors last month that he thought the company would solve its current Full-Self-Driving challenges by the end of next year, something he has said will be the key determinant for Tesla's ultimate stock price.
"If we execute on our objectives, I think we will, my prediction is, Tesla will become the most valuable company in the world and probably by a long shot," Musk said.
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Tesla also said it expected a "slight growth in vehicle deliveries" this year, following last year's record 1.8 million tally.
Musk added on the investor call that he sees the potential for a 20% to 30% growth rate in 2025 "notwithstanding negative external events ... like some big war breaks out or interest rates go sky high or something like that."
Tesla shares were last marked 12.5% higher in premarket trading to indicate an opening bell price of $282.99, the highest since July of last year and a move that would peg the stock's 2024 gain at around 14%.
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