Following the conclusion of the U.S. presidential election, Bank of America has expressed that a victory for Trump is advantageous for Tesla (TSLA, Financial). The bank has upgraded Tesla's rating to "buy" and increased its target price from $265 to $350.
The primary reason, as noted by the bank, is Trump's plan to relax environmental regulations. This move is seen as potentially slowing the development of electric vehicles by other car manufacturers. A reduction in production from competitors could help Tesla maintain its leading position in the U.S. electric vehicle market, especially as the company plans to introduce more affordable entry-level models.
Additionally, Bank of America suggests that under a Trump administration, scrutiny over the autonomous driving sector may become less stringent. Analyst John Murphy mentioned that Tesla CEO Elon Musk has proposed a national standard for regulating self-driving cars, which the Trump administration seems open to considering. This regulatory environment could facilitate Tesla's plans to launch its Robotaxi business by 2025, which currently requires approval from individual states.
