Tesla Stock Bounces Back as Trump Promises to “Purchase a New Tesla Tomorrow Morning”

Tesla Stock Bounces Back as Trump Promises to “Purchase a New Tesla Tomorrow Morning”

The following article does not constitute investment advice, and the author does not hold any positions in the stocks discussed.

Tesla Faces Dramatic Stock Drop Amid Political Controversies

Tesla recently experienced significant stock fluctuations, with shares plummeting approximately 15% during the latest trading session. However, unexpectedly, there seems to be a potential turnaround for the electric vehicle (EV) manufacturer.

Impact of Political Polarization on Tesla’s Brand

Wall Street analysts have been vocal about Tesla’s tarnished reputation, largely fueled by CEO Elon Musk’s controversial political engagements. A recent survey by Stifel indicates a drastic decline in the Democratic support for Tesla, which has now hits “all-time lows.”In contrast, interest among Republican consumers in purchasing Tesla vehicles has seen a marked increase.

This shift in public sentiment indicates a growing partisan divide that could influence Tesla’s sales strategy, particularly as the company grapples with aggressive competition from Chinese automakers.

Export Issues Plague Tesla

The recent selloff was exacerbated by discouraging data regarding Tesla’s exports from China. Reportedly, only 3, 900 EVs were shipped from China in February 2025, a sharp decline from 30, 200 in the same month the previous year. Such startling figures led the China’s Passenger Car Association to publicly note that Musk’s political involvement could negatively impact Tesla’s sales.

Trump’s Influence and Market Response

In an unexpected twist, President Trump announced his intention to purchase a Tesla, framing it as an expression of confidence in the company amid the political backlash Musk has faced. Subsequently, Tesla shares have been trading around $225, showing a slight recovery of 1.28% from the last session’s closing price of $222.15, although they remain lower than their prolonged trading session value of $215.01.

Analyst Sentiment and Revised Projections

UBS has adjusted its price target for Tesla shares to $225. Analyst Joseph Spak explained:

“We are lowering our 1Q25 delivery forecast to 367k from the 437k we projected post 4Q24 outcomes. We believe the current ‘run-rate’ may not be sustainable but anticipate a last-minute surge in deliveries, driven by promotional efforts.”

Moreover, Spak indicated:

“Our updated forecasts suggest a 5% year-over-year decline in deliveries for Q1 2025, alongside a significant 26% quarter-over-quarter drop, positioning our estimates approximately 13% below the current consensus. Our data highlights shorter delivery times for the Model 3 and Model Y, indicating weaker demand overall.”

Engage with Us

Do you believe that President Trump’s endorsement of Tesla could have a sustained positive effect on the stock? We invite you to share your insights in the comments section below.

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