Musk Wants To Double Tesla's U.S. Vehicle Output In Two Years - Morgan Stanley Is Believing It

Musk just made another great plan - He now wants Tesla's electric vehicle production capacity in the U.S. to be doubled within the next two years.

This move not only demonstrates Musk's confidence in the future of the U.S. EV industry but also shows strong support for former President Donald Trump's Made in America policy. Additionally, it reflects mutual support between Musk and Trump, with the latter praising the recent budget cuts by the Department of Government Efficiency (DOGE) and publicly endorsing tesla.

Musk stated on his social media platform X: "As a function of the great policies of President Trump and his administration, and as an act of faith in America, Tesla is going to double vehicle output in the United States within the next two years."

This public statement comes amid a series of operational and market challenges facing Tesla, including a significant drop in stock price and slowing global sales due to opposition from U.S. and European consumers over Musk's growing political influence in Western politics.

As of now, Tesla's stock price has fallen nearly 43% in 2025. The decline has been particularly sharp recently, with Tesla shares plummeting 15% on Monday, marking the worst single-day performance since September 2020. This dramatic drop can be attributed to several factors, including increased competition in key markets and Musk's growing political influence, which has sparked protests from non-MAGA factions and European consumers.

Since taking the helm at DOGE, Musk has implemented sweeping reforms to streamline the federal government, drawing opposition from U.S. civil servants, Democrats, and non-MAGA Republican groups, who have called on Trump to rein in Musk. Additionally, Musk's intervention in European politics and elections has led to global protests and calls to boycott Tesla EVs, resulting in a more than 40% drop in Tesla's stock price this year.

Tesla is facing multiple headwinds, most of which are tied to its CEO, Elon Musk. Currently, Europe and the U.S. are witnessing an anti-Tesla storm, partly due to Europeans' dissatisfaction with Musk's frequent political interventions and his expanding influence in both business and politics. Sales in China are also struggling, with data from the China Passenger Car Association showing a 49% year-on-year decline in Tesla's sales last month in its largest market.

Notably, Tesla's sales in key markets like Europe and China have seen significant declines. In February 2025, Tesla's EV production in China fell by 49.2% year-on-year, lagging behind almost all local Chinese EV competitors. Furthermore, the Texas-based EV giant reported a 1.1% drop in global sales for 2024, marking its first annual sales decline in over a decade. In 2024, Tesla produced 1,773,443 vehicles and delivered 1,789,226, both falling short of market expectations.

Trump Publicly Support Tesla and Musk

Amid Tesla's challenges, former President Trump has publicly expressed strong support. This week, he personally purchased a Tesla Model S luxury electric vehicle, demonstrating his confidence in Tesla's future. He also praised Musk, the head of DOGE, as a "great patriot" and strongly criticized recent boycotts against Tesla, calling them "illegal."

Trump stated that any violent acts against Tesla products would be considered "domestic terrorism." At a White House press conference, Trump warned sternly: "Let me tell you, you do it to Tesla, and you do it to any company, we're going to catch you, and ... you're going to go through hell."

This strong statement comes amid nationwide protests and property damage targeting Tesla EVs. These protests, dubbed Tesla Takedown, are primarily driven by groups, particularly Democratic supporters and federal employees, who are unhappy with Musk's role at DOGE, where he has implemented massive layoffs and cuts to humanitarian programs.

Tesla Stock Rebounds After Trump's Statement, Morgan Stanley Remains Bullish

Boosted by Trump's public endorsement of Tesla and Musk, Tesla's stock rose about 4% on Tuesday. Additionally, Trump announced that the White House would purchase Tesla vehicles for its staff, further boosting confidence among Tesla and Musk fans. As of Wednesday's pre-market trading, Tesla shares were up 3.35% to $238.30. However, year-to-date, Tesla's stock is still down about 43%.

The Trump administration has expressed full support for Tesla and its leader, Musk, in an effort to stabilize investor confidence. In his latest X post, Musk emphasized increasing Tesla's production capacity to support Trump's Made in America policy: As a result of President Trump and his administration's exceptional policies, and to show our firm confidence in America's future, Tesla will double its U.S. car production capacity within the next two years.

In recent months, Tesla's stock has been under pressure due to multiple negative factors, falling nearly 50% from its December 1, 2024, high. Despite this, Wall Street giant Morgan Stanley, a Tesla super bull, remains optimistic about the EV manufacturer's prospects, stating that while the stock has experienced significant volatility, it still has long-term growth potential, and the current pullback is a buying opportunity.

Morgan Stanley highlighted potential positive catalysts, including the launch of Tesla's first autonomous Robotaxi service in Austin, Texas (expected between June and August), updates to federal regulations on Tesla's Full Self-Driving (FSD) technology, and the latest demonstrations of Tesla's Optimus humanoid robot.

In the eyes of tech leaders like NVIDIA CEO Jensen Huang and Wall Street fund managers like Cathie Wood, Tesla's FSD is the most advanced high-level autonomous driving system in the world. However, the biggest concern lies in the regulatory approval process for FSD and Robotaxi in the U.S. and China. Delays in progress could push Tesla's stock into a bearish trajectory.

Morgan Stanley has set a price target of $430 for Tesla and considers it a top pick in the U.S. automotive and shared mobility sectors. The firm also emphasized the long-term growth potential of embodied AI and robotics.