Tesla shares jump as Trump victory threatens to diminish subsidies for alternative energy and electric vehicles

Tesla dominates sales of electric vehicles in the US with 48.9% in market share through the middle of 2024

Electric vehicle maker Tesla is set to reap major gains following a Trump administration victory, with threats to slash subsidies for alternative energy and electric vehicles set to hit smaller rivals the hardest.

Tesla commands the US electric vehicle market with a 48.9% share through mid-2024, according to the Energy Information Administration.

Shares of the company surged 14.8% on Wednesday as its rivals saw their shares decline. Shanghai-based Nio fell 5.3%, Rivian dropped 8.3%, and Lucid Group slid 5.3%.

Mr Trump has proposed tariffs of 10% to 20% on foreign goods, which would also impact electric vehicle makers outside the US, particularly in China, and shares of EV makers there also fell in US markets.

"Tesla has the unmatched scale and scope," Wedbush analyst Dan Ives said in a note to investors. "This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players."

Subsidies for clean energy are included in the Inflation Reduction Act, which was signed into law by Joe Biden in 2022. It provides tax credits for manufacturing and consumers of electric vehicles.

Mr Musk was among Mr Trump's largest donors, pouring more than $70m of his own money into the presidential campaign and other Republican causes. He also pledged to give away $1m a day to voters who signed a petition for his political action committee.

Meanwhile, the price of bitcoin hit a new high and crypto-related stocks rallied as investors anticipated that Mr Trump's victory will benefit cryptocurrencies.

Bitcoin rose nearly 8% in early trading, climbing above $75,000 and surpassing its previous record set in March. Other cryptocurrencies also soared, with ether, the world's second-most popular cryptocurrency after bitcoin, rallying 8%.

Another token, dogecoin, surged as much as 18%. It is Mr Musk's favorite cryptocurrency.

Mr Trump was previously a crypto skeptic but shifted his stance and embraced cryptocurrencies ahead of the election.

He has pledged to make America "the crypto capital of the planet" and create a "strategic reserve" of bitcoin.

His campaign accepted donations in cryptocurrency and he courted crypto enthusiasts at a bitcoin conference in July. He also launched World Liberty Financial, a new venture with family members, to trade cryptocurrencies.

In other news, the parent company of Mr Trump's social networking site Truth Social lost $19.2m in the recent quarter, according to an earnings report.

Much of that loss was due to more than $12m in legal costs, and the company also saw a decline in revenue, according to the surprise Election Day earnings report from Trump Media and Technology Group.

Its stock rose 3% on Wednesday after earlier surging as much as 35%, though that was likely more to do with Mr Trump defeating Kamala Harris to reclaim the presidency than its profit prospects.

Revenue for the three-month period that ended on September 30 was just over $1m, down nearly 6% from a year earlier. Trump Media has lost more than $363m so far this year.