More Tesla jobs to leave California after Musk vs. Newsom battle, Wedbush says

Investing.com — Wedbush analysts see California Governor Gavin Newsom’s proposed revival of the state’s Clean Vehicle Rebate program, which could exclude Tesla Inc (NASDAQ:TSLA), as a “risky political move” that is likely to escalate tensions with CEO Elon Musk.

The analysts highlighted that Tesla accounted for 55% of new EV registrations in California this year, making it a key player in the market. They cautioned that excluding Tesla from state rebates could prompt Musk to shift jobs from its Fremont plant to Texas, further reducing California’s influence over the automaker.

Newsom’s proposal follows expectations that the federal EV tax credit will be eliminated under President-elect Donald Trump’s administration.  Wedbush analysts say they “expect it to happen 100%” in January when Trump assumes office.

While this development is broadly negative for the EV industry, Wedbush argues that Tesla’s unmatched scale and operational efficiency give it a competitive edge in adapting to a non-subsidy landscape.

Wedbush also sees Tesla benefiting from potential Trump-era policies, including higher tariffs on Chinese EVs, which would limit competition from foreign players like BYD (SZ:002594) and Nio (NYSE:NIO). Additionally, Tesla’s advancements in autonomous driving technology could gain momentum under the new administration, with Wedbush estimating this segment alone could contribute $1 trillion to Tesla’s valuation in the coming years.

While reiterating its “outperform” rating on stock with a target price of $400, Wedbush said “The golden goose for Tesla remains a fast-tracked autonomous strategy which we fully expect under Trump and we estimate is worth a $1 trillion of valuation alone to the Tesla story over the coming years.”