In the last five trading sessions, Tesla shares have increased by 20%.

Tesla shares have risen nearly 20% over the past five trading sessions and are still up about 32% over the past month. Several factors have contributed to Tesla’s gains, including CEO Elon Musk’s renewed commitment to a deeper involvement in the company and hopes of a thaw in US-China trade tensions following talks over the weekend.

Progress in China Trade Talks

US-China trade tensions have eased significantly since last weekend. The escalation of tariffs between the two countries in April prompted China to retaliate with a 145% tariff, while also imposing a 125% tariff on US goods.

However, those tariffs have since been significantly reduced. US tariffs on Chinese goods were reduced to 30% for 90 days, while China reduced tariffs on US goods from 125% to 10%.

Although Tesla produces most of its vehicles for sale in China at its Shanghai factory (except for the low-volume, imported Model S and X), the easing of trade tensions is still a positive sign for the company.

Lower tariffs could help reduce the cost of importing components used in US manufacturing, while also reducing the risk of retaliation that could impact Tesla’s operations in China.

Musk “turns around”

Elon Musk has been heavily involved in the newly created Department of Government Efficiency (DOGE) – a key agency in the Trump administration. However, Musk said he will significantly reduce his time in this role starting in May, spending only about 1–2 days a week, to focus more on Tesla.

Although Musk is no longer in this role full-time, his influence in the White House seems to be very large. This was evident during the US President’s current visit to Saudi Arabia, where Musk appeared prominently alongside Mr. Trump as one of the leading members of the US delegation.

Musk’s companies continue to benefit from his close relationship with the President. Musk said that his satellite internet company Starlink has been approved for maritime and aviation use, while Saudi officials also revealed that Tesla’s robotaxi could be deployed in the country.

The visit likely reinforced investors’ confidence in Musk’s influence and access to policymakers, even as he deepens his involvement in Tesla. With Musk back in the driver’s seat, Tesla’s stock could rise to $1,500 a share.

While President Trump has rolled back some tariffs in the past month, tariffs on imported cars remain largely in place. A 25% tariff has been in place on all imported cars and light trucks since early April, while tariffs on some imported auto parts are set to take effect on May 3, 2025.

Tesla could be a net beneficiary of the new tariffs—or at least less affected than its rivals—though that may be temporary. Tesla builds all of its vehicles sold in the US at factories in California and Texas, so it is not affected by the tariffs. Meanwhile, rivals like GM and Ford build some of their electric vehicles in Mexico, which could lead to steeper price increases. That could make Tesla more price competitive with its rivals.