Since Russia’s invasion of Ukraine, world leaders have been working hard to reduce their nation’s dependency on Russian oil exports. This has led to a focus on clean and renewable energy investments as President Joe Biden and his administration prioritize green technology. For companies like Tesla (NASDAQ:TSLA), it’s excellent news. TSLA stock has pulled back into the green following some comments from U.S. Secretary of Transportation Pete Buttigieg.
Of course, the week had started off poorly for Tesla. Even gaining approval to begin production at its Berlin Gigafactory didn’t help TSLA stock overcome negative market forces. However, shares are rising again today as the world responds to Buttigieg’s statements on the cost-saving benefits of electric vehicles (EVs). TSLA began rising this morning and is currently up about 3% for the day.
Here’s what investors should know moving forward.
What’s Happening with TSLA Stock?
Buttigieg has long been a friend to the EV sector. Earlier this month, he credited Tesla with doing “so much to make EVs possible in America.” This is exactly the type of praise that President Joe Biden has been seemingly hesitant to give the company himself, despite CEO Elon Musk’s prodding.
Recently, Buttigieg and Vice President Kamala Harris spoke at a press conference addressing the administration’s $3.7 billion investment in public transportation. While touting the benefits of expanding electric bus fleets, Buttigieg stated that “clean transportation can bring significant cost savings for the American people as well.”
Buttigieg also touched on his department’s previous plan to investment $5 billion in EV charging infrastructure across the country, specifically in rural areas. Buttigieg’s vision clearly includes making it easier for more U.S. consumers to make the transition to driving an EV. Specifically, he addressed the money-saving aspect of eliminating gas costs multiple times.
EV stocks have responded well to the news. TSLA stock isn’t the sector’s only winner so far. In addition, producers such as Lucid (NASDAQ:LCID), Rivian (NASDAQ:RIVN) and Nikola (NASDAQ:NKLA) have all been rising today. The underlying sentiment is clear: EVs received an extraordinary endorsement and Wall Street is happy.
What It Means
Some arguments frame the Biden administration’s EV push as tone deaf, but they fail to see the bigger picture. Electric vehicles are a key component of the clean energy revolution. America needs to stop viewing EVs as a luxury item and see them as a fundamental staple. Buttigieg was correct in his initial assessment of Tesla as the company that helped bring EVs to America, just as he is correct that EVs are part of the country’s future.
This is excellent news for investors, both in TSLA stock and its peers. Buttigieg’s statements should serve as a reminder that the Department of Transportation is run by someone who sees EVs for what they are: the future. As the leader of the EV race, Tesla is well-positioned to keep rising.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.