After a challenging start to 2025, Tesla shares jumped 5.33% on April 2nd, sparking renewed interest among investors wondering if the electric vehicle giant might finally be turning a corner. Year-to-date, however, the stock is still down over 25%, reflecting the weight of a turbulent few months marked by political controversy, global backlash, and internal scrutiny.
Why Did Tesla Stock Go Up?
The recent uptick in Tesla’s stock appears to be largely tied to reports that Elon Musk may soon step back from his advisory role in the Trump administration. While Musk’s exit hasn’t been officially confirmed, a tweet from Trump campaign press secretary Caroline Leavitt called the rumors “garbage,” yet simultaneously acknowledged that Musk’s government role would end after his current 130-day commitment — expected to conclude in late May.
For investors, the prospect of Musk returning focus to Tesla’s operations — and distancing himself from the political spotlight — was a welcome sign. Musk’s high-profile political affiliations and controversial public behavior have been linked to declining brand sentiment globally. Tesla vehicles and EV infrastructure have been targeted in arson incidents in countries like Italy, France, and Germany. The suggestion that Musk might step away from politics, even temporarily, may have helped relieve some pressure from the company’s public image.
Mounting Challenges in 2025
Despite this brief stock rally, Tesla has been under significant pressure. The company has faced accusations of manipulating Canada’s EV rebate program, while also dealing with a broader PR crisis linked to Musk’s divisive presence. Even inside the company, sentiment is mixed. Employee reviews indicate that only about half would recommend working at Tesla or approve of Musk’s leadership.
Adding to the turmoil, Musk’s other venture, X (formerly Twitter), suffered a massive data leak just days ago — a 2.8 billion-profile breach allegedly caused by an insider. With ongoing scrutiny and controversy spanning both Tesla and Musk’s other companies, concerns about long-term investor confidence remain.
Could U.S. Tariffs Help Tesla?
Another factor that may have played into the stock’s April 2nd rally is speculation that the Biden administration’s recent 25% foreign auto tariff announcements might benefit American carmakers like Tesla. As an American-based manufacturer, Tesla may face fewer pricing pressures compared to international competitors who now must contend with higher import costs. This could offer a short-term advantage, especially if competitors are forced to raise vehicle prices.
However, it's worth noting that Tesla’s own supply chain is global, and it’s unclear how insulated they truly are from cost increases due to tariffs.
Is Tesla Still Too Risky?
While the stock remains up nearly 70% over the past 12 months, Tesla’s recent trajectory has been almost a straight decline since the start of the new year. Investor sentiment is clearly divided. The company’s P/E ratio sits at a lofty 138.72 — a figure that raises eyebrows given the operational and reputational risks currently at play.
The uncertainty surrounding Elon Musk’s involvement in politics, the brand’s strained global image, and unresolved regulatory issues make it hard for many investors to feel confident in the short-term outlook. Even with Tuesday’s bump, the path to recovery looks steep.
Final Thoughts
Tesla’s April 2nd surge offers a glimmer of hope that the worst might be over — or at least that investors are eager to see Musk refocus on the business. But between a volatile political landscape, global unrest around the brand, and a high valuation, the road ahead remains rocky.
For now, Tesla is still a high-risk stock. Whether it evolves into a comeback story or a cautionary tale may hinge on what happens next — both inside the company and in Musk’s next move.
This is not financial advice.