Tesla stock jumps 8% on Trump administration plan to relax self-driving car rules

• Tesla stock surged as much as 8% after a report said President-elect Donald Trump plans to ease self-driving car regulations.
• The incoming Trump administration is aiming to prioritize a federal framework for autonomous vehicles.
• The EV-maker's shares have surged 37% since Donald Trump's election win earlier this month.

Tesla stock surged as much as 8% on Monday after a Bloomberg report said the incoming Trump administration is seeking to relax autonomous driving regulations.

That would be a boon for Tesla, which has staked its future on launching fully autonomous electric vehicles in the coming years.

According to the report, President-elect Donald Trump's transition team told advisors that they plan to make implementing a federal framework for fully self-driving vehicles a top priority for the Department of Transportation.

The current federal rules are strict about car manufacturers selling large quantities of vehicles without steering wheels or foot pedals.

For reference, Tesla CEO and Trump ally Elon Musk recently unveiled an autonomous vehicle named the Cybercab with no steering wheel or foot pedals.

Tesla said it plans to begin selling the Cybercab in 2026.

The National Highway Traffic Safety Administration allows manufacturers to deploy only 2,500 self-driving vehicles annually. Legislative efforts to increase the self-driving restriction to 100,000 vehicles per manufacturer a year have repeatedly failed.

A request for comment from the Trump transition team was not immediately returned.

According to Wedbush analyst Dan Ives, if restrictions on fully self-driving vehicles are eased, Tesla will be the main beneficiary, calling it a "significant tailwind for Tesla's autonomous and AI vision heading into 2025."

"Musk's significant influence in the Trump White House is already having a major influence and ultimately the golden path for Tesla around Cybercabs and autonomous is now within reach with an emboldened Trump/Musk strategic alliance playing out in real time and very in line with our thesis," Ives said in a note on Sunday.

Ives estimates autonomous vehicles are a $1 trillion opportunity for Tesla, and if realized, could catapult Tesla to a $2 trillion valuation over the next 12 to 18 months, representing potential upside of 76% from current levels.

Tesla stock has surged 37% since Donald Trump's election win earlier this month.