Tesla’s market cap hits $1 trillion as Trump’s election victory fuels stock rise

Tesla (TSLA+7.30%) The market cap reached $1 trillion on Friday morning Donald Trump’s election victory has contributed to the rise in shares of the electric vehicle maker this week.

The company’s stock price rose more than 6% to about $313 in intraday trading on Friday. It is the first time since September 2022 that Tesla stock has risen above $300 per share. The electric vehicle giant is now the ninth-largest company in the world by market capitalization.

Tesla boss Elon Musk’s alliance with Trump appears to be paying off, potentially giving Tesla a significant advantage under the new administration — including some influence over self-driving vehicle regulation, while putting its competitors at a disadvantage. This also includes a possible impact on regulations for self-driving vehicles.

Gene Munster, managing partner at Deepwater Asset Management, highlighted that Tesla shares have risen 44% in the last 12 trading days, far outpacing the Nasdaq’s 4% rise over the same period.

“This is more than just a meme stock” Munster wrote in a post on X on FridayMusk’s social media company. “Accelerating supply growth next year (flat in 2024 and up +20% in 2025) and the long-term opportunities around autonomy will drive the fundamentals that should drive further price appreciation.”

In a post earlier this weekMunster wrote that Tesla’s rise in recent days was largely “based on emotions, those emotions being that Elon made a big bet and was right.” This gives investors reassurance that his next big bet is a has greater potential for success. His next big bet is autonomy.”

Musk has become a close ally of Trump even in the last few months spend election night with him at Trump Mar-a-Lago Resort in Florida. Earlier this year, Musk founded and donated at least $80 million to a super PAC that supported Trump’s campaign.

And Musk, who also runs several other companies including SpaceX, is now poised to have some role or influence in the incoming Trump administration.

Musk has agreed to lead what he and Trump call a Ministry of Government Efficiency (DOGE), a commission that would do that Behavior a “full financial and performance audit of the entire federal government” and recommends reforms. Musk has said he would cut “at least.” 2 trillion dollars from federal spending, which is likely a difficult task given how much the federal government spends $6.75 trillion in the 2024 financial year.

As part of this job, Musk said he would do it advocate for a national approach to regulating self-driving vehicles – a key market for Tesla – and reducing over-regulation, which he has done repeatedly criticized as if he was holding back his companies. SpaceX, Neuralink, X (META-0.60%) and Tesla are the subject of at least 20 current investigations or reviews.

But whatever is his The exact role in the administration remains unclear. Cantor Fitzgerald CEO Howard Lutnick, who leads Trump’s transition team, said before Election Day that Musk would work “close” to the government and “write software” to help the government cut spending. That would likely allow Musk to continue running his companies without divesting, which he would have to do if he were to take on an official role.

While Trump’s victory is good for Tesla, it is also expected less friendly to other automakers with EV plans. He is expected to freeze President Joe Biden’s regulations Inflation Reduction Act of 2022, which provided $7,500 in tax credits for U.S.-made electric vehicles. Musk has supported eliminating the tax credit because he believes it would help Tesla sales while crushing competition.