Tesla Set to Reclaim $1 Trillion Valuation as China Deal, Robotaxi Launch, and Model 2 Hype Boost Stock

Tesla is once again capturing Wall Street’s attention. With shares surging in premarket trading, investor optimism is riding high on a wave of major developments—from U.S.-China tariff rollbacks and the upcoming robotaxi service to insider buying and potential new model launches. All eyes are on TSLA as it appears poised to reclaim the elusive \$1 trillion valuation mark.

Tesla’s Comeback Surge and

Tesla stock (NASDAQ: TSLA) jumped approximately 8% in Monday’s premarket session, hitting \$322.56 per share. If momentum holds, the company could return to a \$1 trillion valuation—something it hasn’t seen since late February.

The rally comes on the heels of a surprising announcement: the U.S. and China have agreed to significantly reduce reciprocal tariffs for 90 days. The U.S. will cut tariffs on Chinese imports from 145% to 30%, while China will reduce tariffs on American goods from 125% to 10%. This sudden shift in trade dynamics is expected to favor global companies like Tesla, which has robust supply chains across the U.S., China, and Europe.

Even though Tesla is less vulnerable to trade disruptions compared to other automakers, thanks to its geographically diversified operations, the positive trade sentiment has sparked investor excitement. Elon Musk, who has expressed preference for non-predatory tariffs, is likely to welcome this move, as it opens up smoother trade routes and bolsters cross-border EV demand.

Musk vs. Media: WSJ CEO Replacement Story Sparks Backlash

Adding intrigue to Tesla’s eventful week, The Wall Street Journal published a contentious report suggesting Tesla’s board was scouting for Elon Musk’s successor due to his divided attention between Tesla and his work with the Department of Government Efficiency (DOGE).

Tesla clapped back forcefully. Board Chair Robyn Denholm flatly denied the report, calling it “absolutely false,” stating that the board had never contacted recruitment firms to replace Musk. Elon Musk, in turn, accused the WSJ of “an EXTREMELY BAD BREACH OF ETHICS” for ignoring Tesla’s denial before publishing the story.

This corporate drama didn’t faze investors much—likely because Musk had already announced during Tesla’s Q1 earnings call that he would be stepping back from DOGE to focus more on Tesla. This reaffirmation has reassured stakeholders and contributed to bullish sentiment.

Insider Confidence: Joe Gebbia Buys TSLA Before Robotaxi Launch

Insider activity is often seen as a signal of confidence in a company’s future. Joe Gebbia, Tesla board member and Airbnb co-founder, recently purchased \$1.02 million worth of TSLA stock—his first insider buy in five years.

The timing is notable. Tesla is set to launch its first robotaxi service this June in Austin, Texas. According to reports, about 300 test operators are already piloting the autonomous fleet. Musk confirmed that the service will initially use Model Y vehicles and expand to other U.S. cities by year-end.

Gebbia’s purchase, combined with Musk’s renewed commitment and the robotaxi launch, is boosting confidence in Tesla’s near-term innovation and market disruption.

The Awaited “Model 2”: Tesla’s Next Big Catalyst?

Tesla’s Q1 2025 earnings call hinted at upcoming affordable vehicle models—possibly the long-rumored “Model 2” or “Model Q.” Tesla executives reaffirmed that new models will debut this year, designed within the limitations of existing production lines to maintain cost efficiency.

Lars Moravy, Tesla’s product development head, emphasized that affordability and low monthly payments remain Tesla’s top priorities. While no specific model was confirmed, speculation is mounting that Tesla will soon unveil a sub-\$30,000 EV aimed at mass-market consumers.

This model is widely seen as a game-changer, potentially opening Tesla up to millions of new buyers and providing a new growth engine to TSLA stock.

What Undercode Say:

Tesla’s trajectory in 2025 reflects the convergence of macroeconomic policy, technological innovation, and strategic brand management. Here’s our analytical breakdown of the core dynamics:

Valuation Rebound: The potential reattainment of a \$1 trillion valuation hinges on strong investor confidence and macroeconomic easing. The U.S.-China tariff rollback is a short-term tailwind but its impact may diminish if not followed by structural agreements. Market euphoria could correct sharply if negotiations falter or inflation data disappoints.
Robotaxi Impact: The robotaxi launch marks Tesla’s first real step into autonomous urban mobility. If successful, it could revolutionize urban transportation and unlock new revenue streams. However, regulatory hurdles and public trust in autonomy remain key risk areas.
Insider Activity: Gebbia’s purchase is psychologically important. Insider buying is traditionally interpreted as a bullish signal. That said, it’s important to contextualize the \$1 million buy—while symbolically strong, it’s relatively modest for a board member of a \$1 trillion company.
Leadership Drama: The WSJ’s article, though disputed, reveals underlying tension around Musk’s focus. While the board has dismissed the report, Tesla’s success is still closely linked to Musk’s involvement. Any future signs of disengagement may once again rattle shareholders.
Model 2 Prospects: The next-gen affordable vehicle is likely Tesla’s most anticipated product in years. The key to its success lies in balancing price, performance, and profitability. Given the competition from Chinese