Gavin Newsom has a powerful new ally in his fight to electrify the Golden State. The California Governor’s office has announced that Stellantis (NYSE:STLA) has agreed to help reduce air pollution through multiple initiatives designed to get more electric vehicles (EVs) on the road. News of this development has sent STLA stock into the green today.
As Stellantis is the world’s fourth-largest automaker, this is no small feat. Its brand portfolio includes iconic names such as Jeep, Chrysler and Fiat. And while the Big Three automaker didn’t embrace EVs as quickly as some of its peers, the company seems fully committed to helping Newsom accomplish his zero emissions goals. Stellantis has even specified that it will stick to the deal if Donald Trump is reelected in November.
If Trump is able to take back the White House, many environmental stocks will likely be compromised. But Stellantis has shown that it is ready for whatever is coming. For investors, that should be reassuring.
What’s Happening With STLA Stock
While trading has been slightly volatile today, STLA stock is performing well. As of this writing, it is up 0.42% for the day but looks primed to continue rising. Ever since the Big Three automakers of Motor City resolved their dispute with the United Auto Workers (UAW) union, STLA has been rising steadily. The stock has gained more than 46% over the past six months.
Now, its partnership with the state of California is setting it up for even more success in 2024. In a recent statement released by his office, Gov. Newsom discussed his goals of shifting California towards an electric future. In his words:
“This partnership with Stellantis will help California achieve our ambitious goals to drastically cut pollution and get more clean cars on the roads. The biggest and most influential companies in the world understand that this is how we can fight climate change together, and it’s another example of the private sector joining California to help millions of people get into clean vehicles.”
This type of agreement is an excellent step forward for California as it works to reduce air pollution. Electrek reports that if Stellantis delivers on its promises, the state will see its greenhouse gas emissions reduced by “10 to 12 million additional metric tons” through 2026.
With or Without Trump
What should excite investors the most, though, is the fact that this deal is essentially “Trump-proof.” The Republican former president has displayed a consistently anti-EV stance, pushing a narrative that their production is responsible for U.S. jobs disappearing. While fact-checkers have easily debunked his claims, it is clear that if reelected, he would likely take action against the spurring EV adoption that President Joe Biden has prioritized.
Some investors might be worried about the future of EV stocks and the broader clean energy market in general if Trump is reelected. But Stellantis has made it clear that it will be moving forward with its plan to help usher in a greener future for California regardless of the 2024 presidential election result. This should reassure investors that STLA stock is a likely winner for the coming year, even if Trump continues with the Republican tactic of gutting environmental policies.
On the date of publication, Samuel O’Brient did not have (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.
