Trump And Tesla: What The Future Holds For Elon Musk's EV Giant In Case Of A GOP Win

A Donald Trump victory in the U.S. Presidential election could be a “potential positive” for American EV giant Tesla Inc. TSLA, according to analysts from Wedbush.

What Happened: While a Trump victory will weigh heavily upon the electric vehicle industry overall, it could aid Tesla, according to the analysts led by Dan Ives, reported Investing.com.

Trump will likely scrap rebates and tax incentives currently available for EV purchase, they noted, but added that Tesla has “the scale and scope that is unmatched in the EV industry.”

The absence of EV subsidies will give Tesla a clear advantage against other domestic EV makers while Trump’s proposal of imposing steep tariffs on EVs made in China will continue to keep Chinese EV makers out of the U.S. market, they said.

A Trump administration could also aid Tesla CEO Elon Musk’s push towards enabling autonomous driving with its full self-driving driver assistance technology, they said, while warning that Musk’s open support for Trump could weigh on consumer demand for Tesla cars in the U.S.

Why It Matters: Musk is currently actively campaigning for Trump online. He also campaigned for Trump offline in Pennsylvania late last month.

He founded a super PAC called America PAC to which he has so far given over $100 million in a bid to support Trump’s presidential campaign, cementing him as a key figure in this year’s Presidential election.

Musk seemingly holds the same opinion as Wedbush analysts about the elimination of EV subsidies. The CEO said during Tesla's second-quarter earnings in late July that the impact of the elimination of subsidies would only be slight for Tesla but devastating for its competitors.

The elimination of EV subsidies would probably help Tesla in the long term, he said, while adding that the company is relying on vehicle autonomy to boost value. A possible repeal of tax credits on the purchase of EVs, Musk said, is not related to autonomy.

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