Trump's tax plan won't help Tesla, but 2 other EV companies got a stock boost
American electric vehicle makers Rivian and Lucid rose as much as 4.6% and 8.8%, respectively, on Thursday. The gains came after an analyst note from BNP Paribas said that the two companies stand to benefit from Trump's tax bill ending EV tax credits.
On Thursday, the House passed the final version of the bill, which would extend the president's 2017 tax cuts and make key changes to the tax system. The bill would also end the $7,500 EV tax credit awarded to buyers on September 30.
The tax credit removal is expected to lower demand for EVs, and bigger automakers could be hit harder.
Per the new bill, cars made by companies that sold more than 200,000 accepted EVs between December 31, 2009, and December 31, 2025, do not qualify for the tax credit.
Tesla delivered more than 336,000 vehicles in the first quarter of 2025 alone. Rivian delivered 8,000 vehicles in the same quarter, while Lucid delivered 3,109 vehicles.
Like Tesla, Rivian has been struggling with deliveries.Rivian's cars don't qualify for the tax credit, but the company has relied on a leasing loophole for customers to use it. Rivian does not qualify because a requirement mandates that a significant portion of the car battery's materials should be sourced from the US or its trade partners. Lucid vehicles qualify for the $7,500 federal EV tax credit.
Tesla and Lucid are down 22% and 28.5% so far this year. Rivian's stock is down 2% in the same time period.
Big hit to Tesla
The loss of the EV tax credit could be a big hit to Tesla, analysts say.
Last month, Seth Goldstein, an equity strategist at Morningstar, told Business Insider that the expedited elimination of the EV tax credit would be "the biggest area that could impact Tesla."
"Consumers have increased long-range EV choices at similar price points as Tesla," Goldstein said. "It's on Tesla to make the case for consumers to even slightly pay up today versus some other EVs."
Goldstein added that tax credit elimination could decrease sales volume, which the automaker has been struggling with.
JPMorgan analyst Ryan Brinkman wrote in a note last month that Trump's bill, combined with other proposed legislation, including ending the California Air Resources Board Program, threatened more than half of Tesla's 2025 profits.
Brinkman said that the $7,500 consumer tax made up 19% of Tesla's 2024 earnings before interest and tax.
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