Tesla Inc. TSLA experienced a significant stock surge of 8.76% following the news that President-elect Donald Trump’s transition team aims to prioritize the establishment of a framework for fully autonomous vehicles within the Transportation Department.
What Happened: As per Benzinga Pro, Tesla was trading at $346.71 at the time of writing while it closed at $320.72 on Friday.
Other companies in the autonomous vehicle sector, including Alphabet Inc. GOOGL GOOG, Uber Technologies Inc. UBER, and Lyft Inc. LYFT, did not see similar stock gains. Alphabet’s self-driving unit, Waymo, competes directly with Tesla in the autonomous vehicle industry.
Meanwhile, Uber and Lyft, facing competition from both Waymo and Tesla in the ride-hailing market, saw their stocks decline by 1.16% and 0.77%, respectively.
Additionally, Tesla CEO Elon Musk has been appointed to lead the newly formed Department of Government Efficiency (DOGE) under the Trump administration. Musk has previously shown support for federal regulations on autonomous vehicles, highlighting his intention to advocate for the nationwide deployment of self-driving cars during Tesla’s third-quarter earnings call.
Currently, the National Highway Traffic Safety Administration restricts automakers to deploying 2,500 autonomous vehicles annually, with efforts to increase this cap having been unsuccessful thus far.
Why It Matters: The recent developments come on the heels of a significant milestone for Tesla’s Full Self-Driving (FSD) technology. Pierre Ferragu, a Wall Street analyst, noted that Tesla’s FSD completed a 95-mile unassisted journey from Manhattan to Connecticut, showcasing the company’s advancements in autonomous driving capabilities.
Furthermore, there is growing speculation about potential partnerships between Tesla and ride-hailing giants Uber and Lyft. Analysts Tom Narayan and Brad Erickson have expressed increasing confidence in Tesla’s autonomous vehicle goals and its competitive advantages in manufacturing.
Uber CEO Dara Khosrowshahi has also acknowledged Tesla’s potential in the autonomous vehicle space, suggesting that Tesla could either become a rival or a partner, depending on future developments.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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