Trump to Sunset EV Tax Credit: Should Tesla Investors Be Worried?

Trump to Remove EV Tax CreditsOne of the core pieces of U.S. President Joe Biden’s Inflation Reduction ACT (IRA) is clean energy subsidies such as the $7,500 electric vehicle (EV) tax credit. Now that Biden has lost and President-Elect Donald Trump is ready to take over, a lot is likely to change, and today is the first concrete evidence of that. Today, information surfaced suggesting that the incoming Trump administration will seek to end the $7,500 tax credit. On the campaign trail, Trump has long been preaching in favor of removing regulations on the fossil fuel industry so that the country can “unlock American energy” while eliminating subsidies for EVs. Trump has explained that he is not against EVs per se, but is against funding expensive subsidies for them. Are the EV credit removal grounds for selling Tesla (TSLA) shares?Below are 5 Reasons to stay bullish on Tesla, including:1.       The EV Tax Credit Removal is Priced InDonald Trump has pushed for the removal of EV tax credits throughout his campaign, and once he was elected, investors who have paid attention have already priced the news in. Before the tax credit news, TSLA shares had run $100 in a straight line. In other words, some digestion is to be expected.Image Source: Zacks Investment Research2.       Elon Musk CommentsMusk has used his X platform to advocate for removing subsidies for all industries, including clean energy. Because Tesla is the dominant EV maker, such subsidies would likely have a more dramatic impact on U.S. EV competitors like Stellantis Ford (F) and General Motors (GM).3.       Tariffs on Foreign Competition Donald Trump has promised to levy equal tariffs on foreign countries that levy tariffs on the U.S. and are threatening American jobs. These protectionist policies could work in Tesla’s favor as they keep Chinese competition like Nio (NIO) and Xpeng (XPEV) out of the U.S.4.       Livermore RuleJesse Livermore’s round number rule says that when a stock breaks through a psychologically crucial round number like $300, it continues to drift higher. TSLA cleared the level last week and continues to hold above it.5.       Lower RatesTesla was among the hardest hit companies by Powell’s “hawkish” Fed in 2022. However, with the Fed loosening monetary policy, consumers will have more access to “cheap money.”Bottom LineTesla shares fell after news broke that the incoming administration will seek to remove EV tax credits. However, the news was already priced in and there are several reasons for investors to remain bullish into next year.  Free: 5 Stocks to Buy As Infrastructure Spending SoarsTrillions of dollars in Federal funds have been earmarked to repair and upgrade America’s infrastructure. In addition to roads and bridges, this flood of cash will pour into AI data centers, renewable energy sources and more.In, you’ll discover 5 surprising stocks positioned to profit the most from the spending spree that’s just getting started in this space.Download How to Profit from the Trillion-Dollar Infrastructure Boom absolutely free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ford Motor Company (F): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report NIO Inc. (NIO): Free Stock Analysis Report XPeng Inc. Sponsored ADR (XPEV): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks