Tesla’s stock has plunged over 14%, wiping out approximately $152 billion in market value, amid a public feud between CEO Elon Musk and U.S. President Donald Trump. The dispute, which erupted over Musk’s criticism of Trump’s “One Big Beautiful Bill,” has escalated into a high-stakes political and financial confrontation, unsettling investors and raising questions about Tesla’s future.
The Fallout Begins: Musk Criticizes Trump’s Signature Legislation
President Donald Trump, accompanied by Tesla and SpaceX CEO Elon Musk.PHOTOGRAPH: ANDREW HARNIK/GETTY IMAGES
The conflict ignited when Musk publicly denounced the “One Big Beautiful Bill,” a legislative package championed by President Trump. Musk argued that the bill, which includes cuts to green energy subsidies and increases to the national deficit, was detrimental to the electric vehicle industry and the broader economy.
In response, Trump expressed disappointment in Musk, stating, “Elon and I had a great relationship. I don’t know if we will any more.” He further accused Musk of opposing the bill to protect electric vehicle tax credits.
Musk’s Explosive Allegations and Trump’s Retaliation
Donald Trump and Elon Musk watch the launch of a SpaceX rocket in November. Photograph: Brandon Bell/Reuters
The feud intensified when Musk took to social media to refute Trump’s claims, asserting that he was never shown the bill and that it was passed hastily. He further alleged that without his support, Trump would have lost the election, calling out the president’s “ingratitude.”
Musk escalated the situation by accusing Trump of being named in the Jeffrey Epstein files, suggesting that this connection was the reason for the delay in releasing related documents. The White House dismissed these claims as an “unfortunate episode.”
In retaliation, Trump threatened to terminate federal contracts with Musk’s companies, including SpaceX. Musk responded by announcing the decommissioning of SpaceX’s Dragon spacecraft, a critical component of U.S. space operations, only to rescind the threat hours later.
Investor Panic and Tesla’s Market Freefall
The public spat has had immediate financial repercussions. Tesla’s stock plummeted by over 14%, erasing $152 billion from its market capitalization. This decline also impacted Musk’s personal wealth, reducing his net worth by approximately $8.73 billion.
Analysts attribute the stock’s downturn to investor concerns over potential political and regulatory fallout from the feud. Tesla’s reliance on government contracts and subsidies makes it particularly vulnerable to political shifts.
Broader Implications: Tesla’s Global Challenges
Beyond the immediate financial impact, Tesla faces broader challenges exacerbated by the Musk-Trump feud. In Europe, Tesla’s sales have declined sharply, with a 40% year-over-year drop in new vehicle registrations in February. Analysts suggest that Musk’s political affiliations are alienating the company’s progressive customer base.
In China, Tesla is struggling against fierce competition from local EV manufacturers like BYD and NIO. Geopolitical tensions and trade policies under the Trump administration further complicate Tesla’s position in the Chinese market.
The Rise of the “Tesla Takedown” Movement
The feud has also galvanized public opposition to Musk and Tesla. A grassroots protest movement known as “Tesla Takedown” has emerged, organizing demonstrations and urging consumers to boycott Tesla products. The movement aims to economically impact Musk and challenge his political influence.
Also Read: Elon Musk and Trump Feud Sends Tesla Share Price Plummeting
Conclusion: Navigating the Crossroads of Business and Politics
The escalating feud between Elon Musk and President Donald Trump underscores the complex interplay between business leadership and political engagement. For Tesla, the consequences are tangible: a significant loss in market value, declining sales in key markets, and a tarnished public image.
As the situation unfolds, stakeholders will be watching closely to see how Tesla navigates these challenges and whether Musk can reconcile his political activities with the responsibilities of leading a global corporation.
