Tesla Inc ( TSLA ) shares are pulling back Thursday after the gains made following President Donald Trump‘s announcement of interest deductions for EV purchases, as part of the Big, Beautiful Bill. Additionally, Elon Musk's AI startup xAI has struck a major deal to build a Saudi-backed data center using Nvidia Corp ( NVDA ) chips.

What To Know: Trump stated that “middle-income people” weren’t really aware of the deductions during his speech on Wednesday at the U.S.-Saudi investment forum. Trump stated, “We’re giving them a deduction on the interest if they buy a nice Tesla car,” adding that Elon Musk, Tesla’s CEO, was “lucky” to have Trump with him. Moreover, the Saudi-backed deal dropped alongside Nvidia's ( NVDA ) strong earnings, adding fuel to investor excitement around AI.

As part of the administration’s Big, Beautiful Bill Act, taxpayers can deduct up to $10,000 per year in interest on auto loans through 2028, as long as the vehicle was assembled in the United States.

The deduction is available to singles earning up to $100,000 per year and couples earning up to $200,000 per year. The deductible amount drops by $200 for each $1,000 over the $100,000 income threshold.

Nvidia ( NVDA ) CEO Jensen Huang and Elon Musk took the stage Wednesday at the U.S.-Saudi Investment Forum to unveil ambitious plans for a new AI-focused data center. The project will be run by Humain, a company backed by Saudi Arabia's Public Investment Fund. Approximately 600,000 Nvidia ( NVDA ) graphics processing units will be installed at the facility, making it one of the biggest AI-focused data centers globally.

Elon Musk said xAI will be the first to tap into the new Saudi-backed data center, which is set to run on a massive 500 megawatts of Nvidia ( NVDA ) chips. Musk joked about future expansion, saying that scaling the facility 1,000 times over "would be eight bazillion, trillion dollars."

TSLA Analyst Ratings

Tesla has recently seen a generally positive trend among analysts, with significant target price increases and rating upgrades. Notably, Stifel maintained a ‘Buy’ rating for the electric car company and raised its target from $483 to $508 on Nov. 17. Also, Wedbush reiterated an ‘Outperform’ rating, setting a target of $600 twice, on Nov. 7 and Nov. 5.

Other important actions include B of A Securities maintaining a ‘Neutral’ rating but significantly increasing its target from $341 to $471 on Oct. 29. Earlier, on Oct. 24, Freedom Capital Markets upgraded Tesla from ‘Sell’ to ‘Hold’, raising its target from $338 to $406. These shifts suggest a more favorable perspective on Tesla’s financial outlook from these market analysts.

TSLA Price Action: Tesla shares were down 1.38% at $398.35 at the time of publication on Thursday, according to Benzinga Pro.

Read Next:

Nvidia Blackwell Sales Off The Chart, Walmart Earnings Powered By Value-Seeking Consumers

Image: DANIEL CONSTANTE/Shutterstock