Tesla, Rivian, and Lucid stocks are fallling as Trump plans to kill Biden's EV tax credit
The president-elect's transition team reportedly aims to axe the credit as part of a broader tax package
Electric vehicle stocks are falling Thursday after a report detailed the incoming Trump administration’s plans to axe a tax credit for consumers buying cleaner cars.
President-elect Donald Trump’s transition team is planning to get rid of the $7,500 tax credit for EV purchases as part of a broader tax shakeup, Reuters reports. If the credit is removed, the EV transition will likely be hit hard, as prices on numerous models will effectively increase.
Several companies, including Ford Motor Co. and Hyundai Motor Co., have adjusted their plans to ensure that their vehicles qualify for the $7,500 tax credits. In just three months, EV buyers saved $600 million thanks to those credits, the Treasury Department said.
Electric truck and SUV maker Rivian’s (RIVN
-12.34%
) stock fell by more than 12% on Thursday, erasing much of the gains that came after Volkswagen (VWAGY
+0.97%
) increased its planned investment in their joint venture to $5.8 billion. Lucid’s (LCID
-3.21%
) stock price continued its fall from earlier in the day, declining 3%.
Even Tesla (TSLA
-5.32%
), which has been riding an election-fueled stock boom to a $1 trillion valuation, saw its stock decline by 5% on Thursday. Analysts see CEO Elon Musk’s close relationship with the president-elect as a boon to the stock; that relationship includes plans to make Musk co-head of the non-governmental Department of Government Efficiency.
Tesla bull and Wedbush Securities analyst Dan Ives said Tuesday evening that it’s “clear that Musk will have a massive role in the Trump White House with his increasing reach clearly across many federal agencies,” adding that he will likely be involved in discussions related to artificial intelligence and tariffs on China.