Tesla shares surged nearly 7% on Monday, outperforming broader market gains, as easing trade tensions between the US and China lifted investor sentiment and pushed the electric vehicle maker’s market capitalisation back above the $1 trillion mark.
The stock surged over 6% at $318.80, helped by the progress in trade talks with Chinese officials in Switzerland.
The S&P 500 and Dow Jones Industrial Average rose 2.7% and 2.4%, respectively.
Tesla shares have had a turbulent run in 2025. After rallying from around $250 to $480 following the US election amid renewed optimism about a second Trump term and CEO Elon Musk’s ties to the administration, the stock fell sharply after weak first-quarter delivery figures and rising political scrutiny.
Despite the recent rebound, Tesla remains down more than 15% for the year.
Trade detente seen as key positive for Tesla
The agreement includes a 90-day reduction in US tariffs on Chinese goods to a base rate of 10%, down from 34%, with additional levies suspended during continued negotiations.
China is also cutting its own tariffs. Tesla, whose largest and most efficient factory is based in China, relies on the country for roughly 22% of its total revenue.
While Tesla sources most components locally, limiting direct cost impact, sentiment around geopolitical risks tends to weigh heavily on its stock.
Analyst Dan Ives of Wedbush called the tariff pause a “positive step in the right direction.”
Analyst remains bullish
Cantor Fitzgerald reaffirmed its Overweight rating on Tesla with a $355 price target, despite sharp sales declines in Europe.
The firm cited a 62% year-on-year drop in UK new vehicle registrations in April, alongside steeper falls in Denmark (-67%), the Netherlands (-74%), and Sweden (-81%).
Similar declines were recorded in Spain, Belgium, Germany, and France.
Analyst Andres Sheppard acknowledged the stark contrast to last year’s numbers but maintained a long-term bullish stance on the stock.
In contrast, Goldman Sachs reiterated its Neutral rating on the Tesla stock, maintaining a price target of $235.00.
Tesla’s entry into India
Elon Musk-led Tesla is exploring land parcels in Maharashtra’s Satara district to establish a completely knocked down (CKD) assembly facility for electric vehicles, Business Standard reported, citing sources familiar with the matter.
CKD units involve importing vehicles in parts and assembling them locally—a strategy often used to lower import duties and meet local sourcing norms.
The report said Tesla had previously engaged in joint venture talks with Hyderabad-based Megha Engineering, though discussions did not progress.
The company has reportedly held preliminary discussions with other Indian firms for setting up the CKD operation.
Tesla’s entry into the Indian market is now targeted for completion by April 2026, the report added.
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