Elon Musk leaves the stage after addressing a campaign rally with Republican presidential nominee, former President Donald Trump at the Butler Farm Show fairgrounds on October 05, 2024 in Butler, Pennsylvania. This is the first time that Trump has returned to Butler since he was injured during an attempted assassination on July 13. (Photo by Anna Moneymaker/Getty Images) 
Tesla shares climbed as much as 15% in early US trading as investors wager the carmaker run by Elon Musk will be a major beneficiary of Donald Trump’s return to the White House.
The Tesla chief executive was arguably the most prominent supporter of Republicans this election cycle, backing them with more than $130-million in spending and relentless messaging on X, his social media network. While Trump criticised electric vehicles throughout his campaign, he softened his tone somewhat after Musk’s endorsement.
“Let me tell you, we have a new star, a star is born: Elon,” Trump said during an address to supporters at his election watch party in West Palm Beach, Florida. He spoke about Musk for almost four minutes, praising his company SpaceX and calling him a “special guy” and a “super genius”.
Tesla shares are poised to trade at their highest level this year, touching $289.99 during the premarket session. BMW led German automaker stocks lower on Wednesday, falling as much as 6.7% on disappointing quarterly earnings and concern about Trump’s threats to hike tariffs on imported cars.
Volkswagen, Mercedes-Benz and Porsche shares also slumped.
Read more: US swings to Trump and Republican Congress — how it’s playing out and what happens next
“The biggest positive from a Trump win would be for Tesla and Musk,” Daniel Ives, a Wedbush Securities analyst, wrote in a report to clients. Tesla would be at a competitive advantage over other manufacturers in the event the US reduces tax incentives for electric vehicles, he said.
EV risks
Trump’s opponent, Vice-President Kamala Harris, would likely have maintained policies supporting US production and sales of EVs, including the Inflation Reduction Act that President Joe Biden signed into law two years ago. But Musk had already soured on Biden before then, in large part due to the Democrat’s embrace of unions and failure to credit Tesla for leading the EV transition.
Read more: US election analysis and live updates
Multiple EV-related provisions could now be targets for repeal – especially if Republicans take both houses of Congress, BloombergNEF analysts warned last week.
Fuel economy and emissions requirements are also likely to undergo rewrites, as they did during Trump’s first term, which could limit the revenue Tesla generates from selling regulatory credits to manufacturers struggling to comply with Biden’s tougher rules.
Regulatory relief
Musk has downplayed the threat of any pullback in government incentives for EVs while emphasising the potential for companies to benefit from deregulation.
During Tesla’s quarterly earnings call last month he called for a federal approval process for autonomous vehicles and said he would “try to make that happen” if tapped for a role in Trump’s administration.
Under current regulations, carmakers must get permission from the National Highway Traffic Safety Administration before putting cars on the road that lack a steering wheel or other controls required by US auto safety standards. If Tesla were to secure such an exemption, it could only put a few thousand such cars on the road per year.
“The autonomous fast-tracking will be front and centre for investors,” Wedbush’s Ives wrote, speculating that Tesla may be able to accelerate plans to put self-driving vehicles on the road. DM/Bloomberg