Tesla shares have jumped more than 11% on Monday, buoyed by renewed investor enthusiasm following comments from CEO Elon Musk and reports that the company’s Full Self-Driving (FSD) system is preparing for launch in China.
The rally has extended Friday’s 5.3% rise, when Musk reportedly told employees to “hang on” to their stock and outlined his vision for Tesla’s future, centred on autonomous driving and robotics. The two-day rebound comes after nine consecutive weeks of losses—Tesla’s worst weekly streak on record.
“Investors roundly cheered Elon’s vision, confidence, spirit, and calmness,” said Gary Black, co-founder of the Future Fund Active ETF, in response to Musk’s internal remarks to staff.
Musk has argued that Wall Street still underestimates Tesla’s long-term value, highlighting expected revenue from both FSD software and the Optimus humanoid robot. Wedbush analyst Dan Ives called the speech “a major step forward” and said “many showrooms” in the US appear to be seeing renewed buyer interest.
FSD rollout in China drives optimism
Reuters has reported that Tesla is preparing to launch its FSD system in China, citing social media posts from Tesla employees. If approved by regulators, the move would mark the first international rollout of Tesla’s most advanced driver-assistance software.
Tesla charges thousands of dollars for FSD in markets like the US, but faces stiffer competition in China, where local rivals such as BYD offer similar features at far lower prices—or bundle them in for free. Investors will be closely watching whether Chinese consumers are willing to pay a premium for Tesla’s offering.
Tesla is also expected to roll out FSD in Europe later this year.
Tariff relief and broader market gains support the stock
Shares have also benefited from broader optimism that the Trump administration may scale back planned tariffs due to begin on 2 April. Reports suggest sectors such as automotive and semiconductors may be excluded. Tariffs have been a concern for Tesla, which sources many components from Mexico and Canada.
Tesla has not only rebounded with the broader market—tech stocks and the Nasdaq have also risen on Monday—but has outperformed its peers on the day.
Politics and brand backlash cloud the longer-term picture
Despite the recent gains, Tesla shares remain down nearly 37% since President Trump’s inauguration in January. Musk’s political involvement, including his role as an adviser to Trump and controversial public statements in Europe, has drawn criticism and contributed to protests at Tesla showrooms.
Tesla’s sales in Europe have slumped in early 2025. According to Jato Dynamics, February sales fell 44% year-on-year across 25 countries, while January deliveries dropped 45%. The company’s European market share has fallen to 7.7% from 18.4% a year earlier.
Rivals like BYD gaining ground
Chinese competitor BYD has surged. February registrations in Europe rose 94% year-on-year, and the company’s global revenue in 2024 surpassed Tesla’s, hitting US$107bn compared to Tesla’s US$97.7bn. BYD has also launched lower-cost EVs with faster-charging battery platforms, intensifying pressure on Tesla in key markets.
Sales data ahead may decide what comes next
Investors are now looking ahead to Tesla’s first-quarter delivery numbers, due on 2 April. While early expectations were around 414,000 vehicles, recent analyst estimates have fallen closer to 360,000—below the 387,000 delivered in Q1 2024.
Monthly sales data from the European Automobile Manufacturers’ Association, expected later this week, will also provide insight into whether the momentum from Musk’s remarks can be sustained.
