Tesla’s disappointing fourth-quarter sales results and a 6% drop in shares on Thursday have raised concerns among investors. JPMorgan analysts estimate that President-elect Donald Trump’s proposed cuts to EV subsidies could cost the company $3.2 billion. The bank predicts that about 40% of Tesla’s profits would be at risk after Trump takes office.
Tesla reported selling 1.79 million cars in 2024, a slight decline from last year’s record sales. This marks the first time the company has seen a drop in annual vehicle sales. JPMorgan analyst Ryan Brinkman warned that this slowdown could be a wake-up call for investors, as it signals a potential shift towards more affordable and practical hybrids.
Brinkman believes that Trump’s proposals to remove EV tax credits and subsidies would harm Tesla, particularly its most affordable Model 3, which benefits from a $7,500 tax credit. The analyst predicts that Tesla has the most to lose from shifting regulations under Trump, costing it about $3.2 billion in revenue.
Tesla CEO Elon Musk has insisted that removing EV subsidies would benefit the company, but Brinkman disagrees. The JPMorgan analyst reiterated a bearish price target of $135 for Tesla’s stock, citing concerns over declining deliveries and revenue. Despite this, Tesla shares rebounded slightly on Friday morning, up by about 4%.
Source: https://www.businessinsider.com/tesla-profit-could-shrink-under-trump-policies-jpmorgan-2025-1