Al Root

Tesla stock rose early Wednesday. Three things helped: Trump, trade, and U.S. sales data.

Shares of the electric vehicle maker were 2.1% at $277.80, while S&P 500 and Dow Jones Industrial Average futures were 0.8% and 0.7%, respectively.

Stocks, including Tesla, are higher after Commerce Secretary Howard Lutnick said Tuesday evening that a deal to lower tariffs with Canada and Mexico could come as early as Wednesday.

Import tariffs of 25% on both countries went into effect on Tuesday. Tariffs can raise costs and upset supply chains. They are particularly nettlesome for U.S. auto makers that source a significant percentage of the past in most cars assembled American from Canada and Mexico.

Ford Motor and General Motors shares fell 2.9% and 4.6% on Tuesday. Tesla stock dropped 4.4%. Ford shares were up 2.1% in premarket trading. GM share were up 5.1%.

Along with a deal, President Donald Trump thanked Tesla CEO Elon Musk by name in his Tuesday address to Congress while touting the cost cutting accomplishments of the newly created Department of Government Efficiency. "Thank you, Elon. He's working very hard. He didn't need this. He didn't need this. Thank you very much. We appreciate it," said the president. "Everybody here even this side [the Democrat's] appreciates it I believe. They just don't want to admit that."

DOGE has been controversial, even turning off some core Tesla buyers -- politically left leaning Americans that want to go green. Tesla's January sales dropped year over year in the U.S. and Europe, stoking investor fears that Musk's politics were hurting the Tesla brand. U.S. sales bounced back in February. It sold about 42,000 cars in the month, up about 14% from the 37,000 sold in February 2024, according to Ward's Automotive.

Investors will continue to watch for a sales rebound and DOGE activities in the coming months.

Coming into Wednesday trading, Tesla stock was up about 8% since the Nov. 5 election and down about 36% from the Jan. 20 inauguration.

Write to Al Root at allen.root@dowjones.com

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March 05, 2025 07:40 ET (12:40 GMT)

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