President Trump and Elon Musk have seemingly fallen out after a cozy relationship when Musk ran DOGE. Trump gives his take on why Musk is upset.
Tesla CEO Elon Musk’s vocal criticism of the tax cut package the Trump administration and congressional Republicans are advancing has left the company’s investors in limbo as Musk and the president trade verbal barbs over the bill.
The billionaire’s time in the role was tumultuous for Tesla, which became the subject of boycotts in opposition to Musk’s role as the leader of the administration’s Department of Government Efficiency (DOGE), which sent Tesla shares to their lowest levels of the year in March and April.
Tesla shares rallied last month in the lead up to the expiration of Musk’s tenure as a special government employee in late May, with the billionaire signaling he would be less involved in politics as he refocused his attention on Tesla and his other companies. Tesla board members wanted assurances from Musk that he would lead Tesla full-time.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| TSLA | TESLA INC. | 284.70 | -47.35 | -14.26% |
The stock gains unraveled after Musk stepped up his public criticism of the GOP bill and President Donald Trump’s support of it, which escalated into a public war of words on Thursday. The effect sent Tesla shares plunging over 14% during the trading session, while the slide continued in after-hours trading when shares sank as much as 2.7%.
TRUMP SAYS HE’S ‘VERY DISAPPOINTED’ IN ELON MUSK FOR OPPOSING ‘BIGGEST TAX CUTS IN HISTORY’
The bitter spat between Elon Musk and President Donald Trump intensified, sending Tesla shares sliding. (Getty Images)
The slide in Tesla shares over the course of Wednesday and Thursday marked the worst two-day stretch for the stock since the two days ending Nov. 9, 2021, when it dropped 16.25%.
Tesla’s stock is down nearly 20% over the last five days and more than 24.9% year to date.
Since departing his role with the administration, Musk has called the GOP’s One Big Beautiful Bill Act a “disgusting abomination” and urged Republican lawmakers to kill the bill due to its projected impact on budget deficits.
Trump spoke to the press on Thursday during a White House meeting with German Chancellor Friedrich Merz and said he was “very disappointed” with Musk’s criticism of the bill and suggested Musk was aware that Tesla’s EV subsidies would be cut.
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Musk backed the Trump campaign financially and spoke at rallies on the campaign trail. (Jim Watson/AFP via Getty Images)
Musk retorted on his social media site X, saying that he never saw the bill — which was estimated to raise deficits by $2.4 trillion over a decade by the Congressional Budget Office — and again slammed it as being full of wasteful spending.
“Without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate,” Musk said. “Such ingratitude.”
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The feud escalated from there, with Trump writing on his social media platform Truth Social that a good way to cut federal spending would be to eliminate contracts and subsidies involving Musk’s companies: “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it!”
“In light of the President’s statement about cancellation of my government contracts, @SpaceX will begin decommissioning its Dragon spacecraft immediately,” Musk responded. SpaceX’s Dragon spacecraft is currently used to carry both astronauts and cargo to the International Space Station, as well as on private missions. The company is not publicly traded and Musk serves as its CEO.
Trump and Musk watched the launch of SpaceX’s Starship spacecraft together last year. (Brandon Bell/Getty Images)
The Tesla CEO later took aim at Trump’s tariff policies, writing in a post on X, “The Trump tariffs will cause a recession in the second half of this year.”
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Additionally, Musk posted that it was “Time to drop the really big bomb: @realDonaldTrump is in the Epstein files. That is the real reason they have not been made public. Have a nice day, DJT!”
Musk later replied “yes” to a post suggesting that Trump should be impeached and replaced by Vice President JD Vance.
President Donald Trump bought a Tesla from Musk at the White House as a show of support earlier this year when the EV-maker faced consumer backlash over Musk’s political activism. (Mandel Ngan/AFP via Getty Images)
Dan Ives, managing director and senior equity research analyst at Wedbush Securities, wrote in a note to investors that Trump and Musk’s dispute “quickly escalated into essentially a high school friends feud between the once upon a time bromance of Musk and Trump.”
“Tesla’s stock is under major pressure down 15% as investors fear that this Musk/Trump battle will stop their friendship and change the regulatory environment for Tesla on the autonomous front over the coming years under the Trump administration,” Ives wrote.
He added that there is a possibility the feud will settle down to allow the Musk-Trump friendship to continue, but added “this must start to be calmed down on the Musk and Trump fronts, and it’s not good for either side.”
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“This feud does not change our bullish view of Tesla and the autonomous view but clearly does put a fly in the ointment of the Trump regulatory framework going forward,” he explained. “It’s another Twilight Zone moment in this Musk/Trump relationship which now is quickly moving downhill.”
