By Tesla stock surged 7%, while Uber stock dropped the same amount early Monday afternoon following a Bloomberg report said the incoming Trump administration would seek to relax autonomous-vehicle regulations.
That’s seen as a major boon Tesla, which has staked its future on launching fully autonomous electric vehicles in the coming years.
Conversely, autonomous vehicles have been viewed as a potential threat for Uber, as it could allow competing companies like Tesla to launch a network of driverless ride-hailing vehicles.
Citing people familiar with the matter, the report said President-elect Donald Trump’s transition team told advisors they planned to make implementing a federal framework for self-driving vehicles a top priority for the Department of Transportation.
The existing federal rules are strict about car manufacturers’ ability to sell large quantities of vehicles without steering wheels or pedals.
Tesla CEO Elon Musk, a Trump ally, recently unveiled an autonomous vehicle called the Cybercab with no steering wheel or pedals. Tesla said it planned to begin selling the Cybercab in 2026.
The National Highway Traffic Safety Administration allows manufacturers to deploy only 2,500 self-driving vehicles annually. Legislative efforts to increase that limit have failed.
A request for comment from the Trump transition team was not immediately returned.
The jury is still out on whether autonomous vehicles would be bullish or bearish for Uber’s growth story.
Citi analyst Ronald Josey said in a Friday note that autonomous vehicle operators could use Uber’s network to source ride demand.
“Building out AV Services, like Fleet management, and operating a centralized service per city/area likely lowers the barrier to entry for AV networks while leveraging Uber’s services. Simply put, by offering (and scaling) AV services across its partners, we believe take rates can increase as well,” Josey said.
The Wedbush analyst Dan Ives said that if restrictions on self-driving vehicles were eased, Tesla would be the main beneficiary, describing such a situation as a “significant tailwind for Tesla’s autonomous and AI vision heading into 2025.”
“Musk’s significant influence in the Trump White House is already having a major influence,” Ives said in a note on Sunday, “and ultimately the golden path for Tesla around Cybercabs and autonomous is now within reach with an emboldened Trump/Musk strategic alliance playing out in real time and very in line with our thesis.”
Ives estimated that autonomous vehicles were a $1 trillion opportunity for Tesla and, if realized, could catapult it to a $2 trillion valuation over the next 12 to 18 months, representing potential upside of 76% from current levels.
Tesla stock has surged by 37% since Trump’s election win early this month, while Uber stock is down 6%.
