The electric vehicle (EV) sector experienced a significant shakeup on Wednesday, as ChargePoint Holdings Inc (CHPT) shares plummeted 17.01% to $1.22 following Donald Trump’s victory in the 2024 presidential election. This sharp decline is attributed to investor anxieties regarding Trump’s potential policy shifts that could negatively impact the EV industry, particularly infrastructure development that is vital to ChargePoint’s business model.
Trump’s return to office, coupled with a Republican-controlled Senate and a dominant position in the House of Representatives, signals a distinct shift away from the climate-focused policies implemented by the Biden-Harris administration. This shift raises serious concerns about the future of EV infrastructure and the potential for significant setbacks in the industry’s growth.
Throughout his campaign, Trump made it clear that he intends to roll back green energy subsidies and incentives, which have been instrumental in the growth of EV infrastructure. His tax policy agenda includes rescinding federal tax credits for green energy projects, a move that would likely make EVs more expensive for consumers, potentially slowing down the pace of EV adoption.
The Biden administration’s policies provided substantial federal support to the EV market, including charging infrastructure tax credits and rebates, which have played a crucial role in ChargePoint’s network expansion and growth acceleration. Trump’s proposed cuts to these initiatives raise serious questions about the future demand for charging stations, a primary revenue driver for ChargePoint.
Analysts are also expressing concerns about the impact of Trump’s proposed tariffs and trade policies on the EV industry. Trump’s plan to impose a universal 10% tariff on all imports, along with a 60% tariff on Chinese goods, could increase costs for manufacturers and suppliers within the EV supply chain. This is because many EV components, such as batteries, are still sourced internationally.
For ChargePoint, which relies on a global supply chain for equipment and infrastructure, these tariffs could lead to higher costs, squeezed margins, and limitations on the availability of critical components, potentially delaying installations. Furthermore, higher tariffs could drive up EV prices, reducing consumer demand and further suppressing the market for charging networks.
Investors considering whether to hold or sell their ChargePoint stock should carefully analyze their investment timeline, unrealized gains, and total return. ChargePoint shares have decreased by 55.29% in the past year. An investor who bought shares of ChargePoint at the beginning of the year would realize a loss of $0.94 per share if sold today. The stock has also experienced a decline of 11.87% over the past month, meaning an investor who bought shares on October 1 would incur a capital loss of $0.08.
Investors should also consider market dynamics, with the Relative Strength Index (RSI) providing insights into whether a stock is overbought or oversold. ChargePoint stock currently has an RSI of 75.68, indicating overbought conditions.
ChargePoint has a 52-week high of $3.54 and a 52-week low of $1.20. The future trajectory of ChargePoint and the broader EV sector remains uncertain, with Trump’s policy shifts posing significant challenges for the industry’s growth.
