Tesla’s market cap hits $1 trillion as Trump election gains power with stock rally

Tesla’s (TSLA+8.80%) The market cap hit $1 trillion on Friday morning, which Donald Trump’s election victory hair helped the EV maker’s inventory rise this week.

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

Tesla CEO 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 the regulation of driverless vehicles, while putting its competitors at a disadvantage. This includes any influence on the rules for self-driving vehicles.

Gene Munster, managing partner at Deepwater Asset Management, highlighted that Tesla stock is up 44% over the past 12 trading days, far outstripping the Nasdaq’s 4% gain over the same period.

“This is more than just a meme share,” Munster wrote in a post on Friday the Xthe social media company owned by Musk. “Accelerating delivery growth next year (flat-ish in 2024 and up +20% in 2025) and the longer-term opportunity around autonomy will drive the fundamentals that should lead to further price appreciation.”

In a post earlier this weekMunster wrote that Tesla’s rise in recent days is largely “based on emotion, that emotion is Elon made a big effort and was right. This gives investors confidence that his next big bet has a greater potential to succeed. His next big effort is autonomy.”

Musk has become a close ally of Trump over the past several months, even spend election night with him at Trump’s 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 heads 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 one Ministry of Government Efficiency (DOGE), a commission that would conduct a “complete financial and performance audit of the entire federal government” and recommend reforms. Musk has said he would cut “at least” 2 trillion dollars from federal spending, which is likely to be a difficult task given that the federal government has spent $6.75 trillion in the financial year 2024.

As part of that job, Musk said he would advocate for a national approach to regulating driverless vehicles — a key market for Tesla — and cutting back on overregulation, which he has repeatedly criticized as holding back its businesses. SpaceX, Neuralink, X (META-0.61%), and Tesla is collectively the subject of at least 20 recent studies or reviews.

But whatever his The exact role may be in the administration is still unclear. Cantor Fitzgerald CEO Howard Lutnick, who is helping lead Trump’s transition team, said before Election Day that Musk would work “alongside” the government and “write software” to help the government cut spending. That would likely allow Musk to continue running his companies without divesting himself, as he would have to do if he took an official role.

While Trump’s victory is good for Tesla, it is expected to be less friendly to other automakers with electric cars. He is expected to freeze supplies from President Joe Biden The Inflation Reduction Act of 2022, which provided a $7,500 tax credit for American-made electric vehicles. Musk has backed ending the tax credit, believing it would help Tesla sales while undermining rivals.