Over the previous 12 months, Tesla (NASDAQ:TSLA) inventory’s taken a backseat in Elon Musk’s thoughts. Since publicly endorsing Donald Trump’s Presidential marketing campaign on 13 June 2024, the billionaire has devoted appreciable power to political priorities and fewer on electrical autos (EVs).
That is perhaps about to alter. Refocusing his consideration to enterprise, Musk lately pledged to spend much less cash on politics. He nonetheless plans on being Tesla’s boss in 5 years’ time.
So how has Tesla inventory carried out since its CEO’s foray into the political enviornment? And what does the longer term maintain for the world’s most dear EV firm?
Associates in excessive locations
Having an in depth affiliation with the US President would often be an asset for any CEO. That was the opinion of many Tesla traders instantly after Trump’s victory. Within the six weeks following the election, the agency’s share value nearly doubled to $488.54.
Sentiment’s since cooled amid shareholder concern over Musk’s political statements and his controversial function within the Division for Authorities Effectivity (DOGE). Tesla shares are presently altering arms at $334.62. They’re down 9% in 2025.
Nonetheless, traders who put £10,000 into the enterprise when Musk endorsed Trump would have made a considerable achieve. With that sum, they’d have been capable of purchase 70 shares.
Right now, that place can be value £17,484.98, accounting for foreign money change charge fluctuations — an enormous return of round 75%!
Model injury
Regardless of spectacular features, the jury’s nonetheless out on whether or not Musk’s actions have damage Tesla inventory’s long-term future. Even outstanding backers, reminiscent of ARK Make investments‘s Cathie Wooden, acknowledge the carmaker’s model has suffered. This poses a danger to traders.
On the excessive finish, the corporate’s showrooms have attracted ‘Tesla takedown’ protests and dealerships have been vandalised. Mainstream customers are shunning the agency too, with gross sales plummeting to a three-year low of lower than 337,000 EVs in Q1 of 2025.
Musk’s eager to restore the hurt to Tesla’s public picture. His pullback from the limelight and a renewed give attention to the enterprise he’s headed since 2008 are telling indicators that injury management efforts are underway.
The place subsequent for Tesla?
Intensifying competitors within the EV sector’s one other problem for Tesla. The enterprise hopes a brand new robotaxi trial in Austin, Texas, as a result of begin in June, could possibly be the reply to its present issues.
There are vital regulatory hurdles to beat and different corporations, reminiscent of Alphabet‘s Waymo, have stolen a march on Musk’s enterprise within the driverless cab area. Tesla’s making ready for mass manufacturing of its CyberCab in 2026.
The optics of the agency’s robotaxi launch, which solely includes 10-20 autos, will likely be important. There’s little room for error contemplating Tesla inventory’s valuation sits at an eyewatering ahead price-to-earnings (P/E) a number of above 156.
However, Musk doesn’t lack ambition. He’s promised “a whole bunch of hundreds” of self-driving Teslas will likely be on American roads inside 18 months. This could possibly be a gamechanger for the Tesla share value, however there are vital execution dangers.
The inventory’s nonetheless value contemplating regardless of latest difficulties. I’ll proceed to carry my small shareholding. As this watershed second for the corporate approaches, it’s reassuring that Musk plans to spend extra time within the boardroom and fewer within the Oval Workplace.
