This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy.
Elon Musk has occupied an office in the West Wing of the White House not even for a week in his new capacity as the head of the Department of Government Efficiency (DOGE) and already rampant speculation has emerged as to the fraying of the heretofore unassailable bonhomie between the seemingly untouchable mega-billionaire and his most powerful ally, President Trump.
As most of our readers would know by now, President Trump formally announced the Stargate project on Tuesday, envisaging at least $500 billion invested in the US over the next four years to build out the requisite AI infrastructure.
However, in what appeared to particularly rankle Elon Musk, OpenAI is slated to play a pivotal role in this signature initiative, alongside the data center behemoth Oracle and the Japanese giant SoftBank.
As we highlighted in a dedicated post recently, Elon Musk took a particular exception to OpenAI's X post announcing the immediate deployment of at least $100 billion in capital, going on to publicly declare that "they [Stargate participants] don't actually have the money."
Of course, there is no love lost between Elon Musk and OpenAI. The two are not only competitors in the LLM sphere but Musk has also sued OpenAI for transitioning to a for-profit structure.
Oppenheimer Keeps $TSLA at Market Perform Without a Price Target, noting that they "continue to see significant risk to Trump/Musk's relationship potentially jeopardizing TSLA's benefits from it."
Analyst commented: "We anticipate Tesla to continue focusing resources and its… pic.twitter.com/3gLydSOGzO
— Wall St Engine (@wallstengine) January 23, 2025
This brings us to the crux of the matter. Oppenheimer has now penned an exhaustive note on these developments, highlighting the inherent risks for Tesla in the emerging paradigm:
"We anticipate CEO Elon Musk will highlight his impact on the US political landscape, but continue to see significant risk to Trump/Musk's relationship potentially jeopardizing TSLA's benefit from it."
Elsewhere, the Oppenheimer analyst sees Tesla retaining the focus of its resources and the overall narrative "on Physical AI technology leadership while further moderating vehicle sales growth expectations in 2025 under the guise of preparation for Model 2 and autonomous vehicle introduction."
The note goes on:
"We expect improvement on mean time between failures (MTBF) and total miles driven, but will be looking for details on system ground truthing and TSLA's ability to streamline/customize foundation models for autonomy as better indicators of progress."
Do you think the current bonhomie between Elon Musk and Trump will be able to survive a clash of egos that seems inevitable? Let us know your thoughts in the comments section below.
Follow Wccftech on Google to get more of our news coverage in your feeds.
