Years in the past, when Biden took workplace, the main electrical automobile firm wasn’t invited to Washington’s EV Summit. “Yeah, appears odd that Tesla wasn’t invited,” the corporate’s CEO Elon Musk mentioned in a tweet.
In reality, Biden credited GM’s Mary Barra as being the EV business chief. “Mary, you electrified the complete auto business, you led,” Biden gushed — apparently unaware that GM delivered a paltry 26 EVs in This autumn 2021.
And it solely acquired worse.
Lawsuits started to pile up. Did the Biden administration resort to utilizing “lawfare” in opposition to Elon Musk? Exhausting to say. Nevertheless, in response to CNBC, beneath the Biden administration, “Musk’s corporations are at the moment embroiled in a spread of probes and lawsuits from federal companies pertaining to issues together with alleged securities legislation violations, office security, labor and civil rights violations, violations of federal environmental legal guidelines, shopper fraud and automobile security defects… [spanning] 19 identified ongoing federal investigations and lawsuits in opposition to Tesla, SpaceX and X, previously often called Twitter.”
Probably probably the most public courtroom case was Chancellor Kathaleen McCormick of Delaware’s choice in 2024 to kill Elon Musk’s $55 billion compensation package deal. This would go away the CEO of Tesla with none compensation from Tesla for six years. Bloomberg reviews, “Musk logged hundreds of hours on the helm of Tesla and elevated its market worth ten-fold.”
Does this Delaware decide’s choice to halt Musk’s pay “odor” of lawfare?
And this choice is now beneath much more scrutiny after a vote at Tesla’s Shareholder Assembly (once more) confirmed he deserves to obtain his pay package deal. Just lately, the Delaware decide acknowledged, “I write to tell you that I goal to problem that call earlier than the tip of this yr.” Hmmm, we’ll see how that call unfolds.
At finest, Tesla’s CEO has been slighted and snubbed by the Biden administration. At worst, Musk has withstood an unrelenting assault over the previous 4 years. If these courtroom circumstances, probes, and lawsuits start to abate beneath the Trump administration, it’s probably that Tesla inventory, as a long-term funding, turns into massively “de-risked” for its shareholders. It’s conceivable that Elon Musk, unburdened by these assaults, may be capable of run the corporate extra successfully.
In reality, the Trump crew might create insurance policies that may (gasp) really be optimistic for Tesla. Living proof — this week, Bloomberg Information reported Trump’s transition crew has advised advisers it plans to make a “federal framework” for full self-driving (FSD) one of many Transportation Division’s priorities, in response to individuals accustomed to the matter. This might assist Tesla fast-track its rollout for robotaxis within the not-so-distant future.
That mentioned, not all of Trump’s insurance policies will assist EV automakers. Already, Trump’s crew communicated its want to eradicate the $7,500 tax credit score for electrical autos. However even that would profit Tesla. Elon Musk’s automaker has margins that may face up to shedding the tax credit score. Positive, it should sting nevertheless it’s probably that Detroit and Europe’s automakers want it extra. It’s affordable to imagine Tesla might achieve market share within the coming years as different automakers might sluggish EV manufacturing.
In accordance with Wedbush Securities analyst Dan Ives, Trump’s insurance policies ought to be a “homerun for Tesla… Tesla has the dimensions and scope that’s unmatched within the EV business and this dynamic might give Musk and Tesla a transparent aggressive benefit in a non-EV subsidy atmosphere, coupled by probably larger China tariffs that may proceed to push away cheaper Chinese language EV gamers (BYD, Nio, and so forth.) from flooding the U.S. market over the approaching years.”
Ultimately, Elon Musk ought to achieve traction with the brand new administration contemplating his shut relationship with Trump and his work on the forthcoming DOGE (Division of Authorities Effectivity). How this all impacts Tesla stays to be seen. However one factor is obvious — shareholders of Tesla ought to really feel some reduction because the inventory has been “de-risked” shifting ahead.
===
Co-founder of EVANNEX, Matt Pressman owns each a Tesla Mannequin S and Mannequin 3 and stays a long-term investor in TSLA inventory. He’s written extensively about Tesla and his work has been revealed in CleanTechnica, InsideEVs, and Teslarati. He’s additionally appeared quite a few occasions on Fox Enterprise Information and PBS to offer his views on Elon Musk and Tesla.
