Elon Musk joined President Donald Trump for a press briefing inside the Oval Office at the White House on May 30, 2025, in Washington. (AP Photo/Evan Vucci, File)
Tesla's stock price took a sharp tumble on Tuesday, driven by a heated public spat between Elon Musk and former President Donald Trump. The tension between the two billionaires has escalated dramatically in recent days, with Musk hinting at forming his own political party and Trump openly criticizing Musk’s businesses.
The electric car giant, led by Musk, saw its shares fall nearly 6% in early trading. This year alone, Tesla’s stock has already dropped over 20%, with declining sales in key markets like Europe and China. Industry experts point to growing public backlash against Musk’s political stances and his increasing alignment—followed now by fallout—with Trump.
Trump vs. Musk: A Partnership Turns Hostile
The feud between Musk and Trump, once friendly, has now morphed into a public spectacle. Trump has accused Musk of taking massive government subsidies and suggests that, without them, Musk's ventures—including Tesla and SpaceX—might not survive.
“He’s received more subsidies than anyone in history,” Trump posted on his platform, Truth Social. “Without them, Elon would probably pack up and go back to South Africa.”
In a bold counter, Musk suggested he might create a third political force. If the government proceeds with what he calls a reckless spending bill, Musk said he would launch the "America Party" to offer an alternative to both Republicans and Democrats.
Wall Street Reacts Cautiously
Market analysts are concerned. Dan Ives from Wedbush Securities wrote that this public fallout creates serious concerns for investors. The fear is that a Trump-led administration could tighten scrutiny on Musk’s businesses—especially those relying on government support, like Tesla’s EV incentives or SpaceX’s space contracts.
“The once tight friendship now feels like a high-school breakup gone bad,” Ives noted, calling it a “soap opera” that could cast a long shadow on Tesla's future.
Political Ramifications Mount
The heart of the disagreement lies in a massive government spending bill. Musk claims it will increase national debt, kill jobs, and choke emerging industries. Over the weekend, he posted that Republicans supporting the bill are betraying their voters.
“Every member of Congress who promised to cut spending but voted for this bill should be ashamed. And I’ll make sure they lose their seat next year,” Musk posted on X (formerly Twitter), a message viewed 26 million times.
Shortly after, Musk upped the ante. “If this insane spending bill passes, the America Party will be formed the next day,” he declared, a post that racked up over 32 million views.
Trump’s Warnings Continue
During a White House departure for Florida, Trump doubled down. When asked if he planned to deport Musk, Trump played coy but issued a warning. Referring to the now-defunct Department of Government Efficiency (DOGE), which Musk once led, Trump hinted it could be used against him.
“DOGE is the monster that might have to go back and eat Elon,” Trump said. “He gets a lot of subsidies.”
Musk Tries to De-Escalate, But Criticism Remains
Despite the intensity of Trump’s remarks, Musk responded on X with a measured tone, stating he wouldn’t escalate the situation. Still, he couldn’t resist one final jab, pointing out the contradictions in Trump’s claims.
“What good is DOGE saving $160B when this bill raises the debt ceiling by $5T?” Musk questioned. “It makes a mockery of the entire effort.”
