Summary
- Wedbush analyst Dan Ives reaffirms "outperform" rating and $400 price target for Tesla stock
- CA Governor Gavin Newsom plans to create EV incentive that excludes Tesla, sparking a conflict
- Analyst warns that excluding Tesla from incentive could lead to a battle between Newsom and Musk
- Newsom’s move seen as a political strategy against Musk, who has clashed with him in the past
- Tesla is the only carmaker producing vehicles in California, potential exclusion from incentives could lead to job relocation
Article
Wedbush analyst Dan Ives recently commented on the developing conflict between California Governor Gavin Newsom and Tesla, maintaining an “outperform” rating and $400 per share price target for Tesla stock. Governor Newsom announced plans to create a state EV incentive if the federal tax credit for electric vehicles is removed, but the incentive would exclude Tesla, prompting Elon Musk to describe the plan as “insane.”
Ives believes that the governor’s proposed EV incentive could lead to a “Game of Thrones” battle between Newsom and Musk, potentially posing risks for the governor as Tesla is the only carmaker still producing vehicles in California and one of the state’s largest employers. The exclusion of Tesla from the incentive could spark further tensions between Newsom and Musk, who have clashed over issues in the past, including during the Covid shutdowns of Fremont in 2020 and the relocation of Tesla HQ to Texas in 2021 with the establishment of the Austin Gigafactory.
Newsom’s decision to potentially exclude Tesla from the rebates is seen as a political move towards Musk, who has a close relationship with the Trump White House and plays a significant role in the push to eliminate federal tax credits for EVs. Ives believes that this move could result in Musk relocating more jobs from Fremont to Austin if Tesla is excluded from the tax credits, given that the majority of EVs sold in California are produced by Tesla. The analyst suggests that the governor’s decision could have significant implications for the EV market and innovation.
The conflict between Newsom and Musk over the proposed EV incentive highlights the ongoing tensions between government officials and influential technology companies in California. As Tesla continues to be a major player in the EV market and a significant contributor to California’s economy, the exclusion of the company from state incentives could have wider implications for the industry and the state’s economic future. The outcome of this dispute could impact the relationship between government and technology companies in California, shaping future policies and decisions regarding the promotion of electric vehicles.
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