NEW YORK (AP) 鈥 For Elon Musk fans, it鈥檚 the half a trillion-dollar bet.
That is how much the stock market value of Tesla has rocketed since the presidential election, a vertiginous climb uninterrupted in recent days despite a disappointing financial report that would have sunk the stock of nearly any other company.
Investors are wagering that President Donald Trump will help Musk鈥檚 company more than hurt it with his plans to take an axe to reams of Washington regulations and wield tariffs to get his way with key trading partners.
Less regulation? Fantastic. Trade war? No biggie.
鈥淚t鈥檚 going to be a golden age for Tesla and Musk,鈥 said Wedbush Securities financial analyst Dan Ives, adding after an investor conference call Wednesday, 鈥淭his is the most bullish I鈥檝e ever heard Musk.鈥
Investing in Tesla has long been a gamble. Odds were against Musk creating a successful electric car company, never mind growing it to become the world鈥檚 most valuable automaker 鈥 and in the process making himself the world鈥檚 richest person. But this latest bet seems particularly risky.
Musk says the true value of his company lies in a future of Tesla robots, thousands of them possibly by the end of the year, and in unsupervised, driverless vehicles. He promised in Tesla's investor conference call to start offering such robotaxis in June in Austin, Texas, and across the country by the end of next year.
Speeding all that along will be Trump, or so the story goes, who has given Musk an office in the White House and made him the head of the new Department of Government Efficiency tasked with shrinking the size of the government.
Trump鈥檚 new transportation secretary, who can have a big impact on Tesla, is mostly sticking to the script. Sean Duffy has promised to cut excessive regulation on automakers as well as to come up with a single set of federal rules on self-driving technology to replace a patchwork of state-by-state ones that Musk has blasted for holding back development.
Perhaps more importantly, Trump , a big market for Tesla, hitting the country with an additional 10% tariffs starting Saturday, and not the 60% he threatened on the campaign trail. Still, Trump's , as well as China, sent the stock down 5% Monday, a bit worse than other automakers. Chief Financial Officer Vaibhav Taneja said last week the company should feel an impact to its business because it sources parts from around the globe.
Trump has also vowed to do other things that will hurt Musk鈥檚 business.
Trump said he wants to eliminate a $7,500 federal tax rebate designed to get people to buy electric vehicles. He also plans to , a potential blow to Tesla鈥檚 business of selling 鈥渞egulatory credits鈥 to car makers that pollute more and fall short of the requirements. Tesla sold $692 million of n the last three months of 2024, a 60% jump from a year ago, revenue that nearly all flows straight to Tesla鈥檚 bottom line.
It鈥檚 also unclear whether the Trump administration will hold off on investigations into Tesla, in particular a technology the company calls Full Self-Driving, a misnomer because the vehicles could require human intervention at any moment. In October, the transportation department鈥檚 auto safety regulator, the 春色直播 Traffic Highway Safety Administration, launched the latest of several into the technology after getting reports of crashes in low-visibility conditions, including one that killed a pedestrian.
Transportation Secretary Duffy at a hearing earlier this month that he would let the Tesla investigations follow the facts 鈥 specifically vowing to buck any political pressure to go easy on the self-described 鈥渇irst buddy鈥 of the president.
Musk will need all the regulatory relief and other goodies from Trump that he can get.
In early January, in 2024, a first in more than a dozen years, as rivals such as BMW, Volkswagen and China鈥檚 BYD come out with competitive EVs and steal market share.
Then on Wednesday, Tesla reported revenue, profits and other key measures of financial health for the last quarter of 2024 of what analysts had expected. The stock climbed higher anyway.
鈥淭hings that would hurt other automakers,鈥 marvels Morningstar analyst Seth Goldstein, 鈥漝on鈥檛 seem to impact Tesla.鈥
Besides the business, Tesla shareholders must always keep one eye on the CEO himself. Lately, that鈥檚 meant weighing Musk鈥檚 foray into politics.
In Europe, a major market for his cars, Musk has and called British an 鈥渆vil tyrant鈥 who is running a 鈥渢yrannical police state.鈥
On Inauguration Day in the U.S., Musk made a straight-arm gesture during a speech that many interpreted as Nazi salute. He scoffed at the criticism, but the was fierce nonetheless. In Germany, an image of Musk making the salute was projected onto his massive Tesla factory outside Berlin in protest. In Italy, a communist youth group hung an effigy of Musk upside down in the same square in Milan where the fascist dictator Benito Mussolini was strung upside down, too.
鈥淗ow many of these Tesla buyers agree with Musk?鈥 said Felipe Munoz, a senior analyst at auto researcher Jato Dynamics. 鈥淚 don鈥檛 see the point of alienating potential customers.鈥
Musk also risks turning off regulators in Europe, who he hopes will soon approve the use of Full Self-Driving there.
If investors start losing faith in Musk, it鈥檚 a long way down.
The run-up in Tesla stock alone since the election amounts to more than the annual economic output of 160 countries. Tesla鈥檚 total market value has grown to about $1.3 trillion, more than the worth of General Motors, BMW, Ford, Ferrari, Porsche and a dozen other top car makers combined.
Musk thinks that, if anything, the stock should be higher.
鈥淚 see a path for Tesla being the most valuable company in the world 鈥 by far, not even close,鈥 he said Wednesday, before doubling down on that statement. 鈥淭here is a path where Tesla is worth more than the next five companies combined.鈥
That would mean surpassing the likes of Microsoft, Apple and Nvidia. Tesla is currently the seventh-most valuable company in the S&P 500.
Wedbush's Ives, the 鈥済olden age鈥 analyst, agrees the stock can only go up from here.
鈥淭he bet for the ages that Musk made was on Trump,鈥 he said. 鈥淢usk is going to have massive impact on deregulation in the beltway 鈥 and that is worth a trillion dollars.鈥
