Cathie Wood’s Faith in Tesla (TSLA) Unshaken Despite Trump-Musk Clash

Despite the growing public tensions between President Donald Trump and Tesla’s (TSLA) CEO Elon Musk, Ark’s Cathie Wood isn’t backing down from her bullish stance on Tesla. The star fund manager remains confident in the EV giant’s long-term vision, reaffirming her trust in Musk’s leadership and Tesla’s disruptive potential, even as political drama unfolds around him.

Earlier this month, Cathie Wood’s ARK Innovation ETF (ARKK) trimmed its Tesla holdings ahead of the company’s much-anticipated Robotaxi launch. Despite the recent sell-off, Tesla retains a core position in the fund, underscoring Wood’s long-term belief in the stock. A consistent Tesla bull, Wood remains confident in the company’s potential to lead the emerging robotaxi market.

Wood Weighs In on Musk–Trump Drama

Wood, CEO of ARK Investment Management, noted that Musk and his investors are gaining a clearer picture of just how much influence the U.S. government holds over the companies Musk leads. She suggested that Musk’s clash with Trump may be a strategic move to distance himself from government ties and reduce association with the Republican party, especially given Trump’s increasingly tough stance on China, a critical market for Tesla’s manufacturing and sales. She added that he wants to avoid any risk to Tesla’s operations in China.

Her remarks followed Musk’s public criticism of Trump’s “One Big Beautiful Bill,” which he claimed would deepen the national deficit. In response, Trump questioned Musk’s contributions and threatened to cut federal contracts with Tesla and SpaceX. The feud sent Tesla shares tumbling 14% on Thursday, wiping out over $150 billion in value, before rebounding 3.7% on Friday.

Wood Stands by Tesla

Despite the political tension, Wood remains confident in Musk’s leadership, emphasizing that he “works really well under pressure.” Musk has previously stated that his mission includes helping the U.S. reduce its budget deficit through rapid economic growth. According to Wood, Tesla’s board should support Musk in refocusing on that broader economic vision.

Importantly, Tesla remains the largest position in ARKK, the firm’s flagship fund, accounting for 10.3% of its portfolio. Regarding her Tesla investment, Wood noted that she’s accustomed to volatility and has been actively adjusting her position to capitalize on sharp price swings.

Is Tesla a Good Share to Buy?

On Wall Street, analysts have maintained a neutral stance on Tesla stock. According to TipRanks, TSLA stock has received a Hold consensus rating, with 16 Buys, 10 Holds, and 10 Sells assigned in the last three months. The average Tesla stock price target is $285.91, suggesting a potential downside of 3% from the current level.

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