Tesla is facing mounting pressure from escalating U.S.-China trade tensions, largely due to its reliance on production and battery cells from Giga Shanghai. Retaliatory actions from Beijing could further squeeze Tesla's margins and weaken its competitive position.
Meanwhile, prediction markets are signaling a clear winner: Nvidia. The market currently prices a 68.5% chance that Nvidia will be the largest company by market cap on June 30. Despite Tesla's pivot toward AI and autonomy amid declining EV deliveries, its exposure to supply chain disruptions remains a key vulnerability.
A recent U.S. Supreme Court ruling against certain Trump-era tariffs could pave the way for renewed trade talks, but the current administration's stance suggests continued protectionist measures. For now, the geopolitical environment appears consistent with scenarios favoring Nvidia's leadership.