Tesla (NASDAQ:TSLA) shares are under pressure after U.S. President Donald Trump revoked a pro-EV policy that mandated half of all new U.S. cars be electric by 2030. The stock fell more than 3% in early trading on Tuesday and was trading at $417.12, down 2.20%, as of 11:14 AM ET.

The rollback is part of Trump's first-day agenda, which saw 78 executive orders revoked, including measures aimed at bolstering clean energy. Trump also signaled plans to review and potentially eliminate EV subsidies and tax credits, which he called unfair market distortions. These credits, initially introduced under George W. Bush, were expanded under Biden's Inflation Reduction Act.

Tesla CEO Elon Musk, however, downplayed the impact on his company, saying, It would be devastating for our competitors and for Tesla slightly...but long term, probably actually helps Tesla. Other EV stocks, including Lucid (NASDAQ:LCID) and Rivian, tumbled nearly 7% and 5%, respectively, on the news. Traditional automakers like General Motors (NYSE:GM) and Ford (NYSE:F) saw gains, with GM rising 4.49%.

Despite today's decline, Tesla shares have surged over 60% since Trump's election victory in November, driven by optimism around the so-called Trump trade.