Elon Musk and Donald Trump's Feud: Implications for Tech Industry and Government Relations

Why Musk is vulnerable in conflict with Trump

Musk's alliance with the president was expected to bolster his businesses and wealth. Now, he's leaving with a bruised reputation and more uncertainties. In the days after the 2024 election, Elon Musk seemed unstoppable. After plowing at least $288 million into helping elect President Donald Trump and other Republicans, the payoff for the Tesla and SpaceX CEO was immediate. Tesla's stock soared, making the world's richest man even richer. His influence in Washington was incomparable, and government support for his ambitions -- whether launching spaceships to Mars or autonomous cars across America -- seemed more plausible than ever. Now, all of that could be in doubt. The spectacular public feud last week between Musk and Trump has laid bare just how much Musk may lose if their rocky relationship continues to unravel. While Trump and the GOP have benefited from Musk's money, Musk is most vulnerable if the president uses the levers of government to retaliate -- a prospect the president raised in a message last week threatening to cancel Musk's companies' federal contracts. "It will come down to how much pain does Trump want to inflict," said Gene Munster, an analyst at Deepwater Asset Management. Over the weekend, Musk appeared to take a step to de-escalate by deleting some of his most acrimonious messages on X about Trump. While Trump has resisted going all-out in clashing with his former ally, on Saturday he threatened "very serious consequences" against Musk if he were to back Democrats. Musk hasn't said he would do that but suggested he would like to found a new political party. A Washington Post analysis this year found that the billionaire and his businesses have received at least $38 billion in government contracts, loans, subsidies and tax credits over the years. The assistance, The Post found, helped catapult Musk into becoming the richest person in the world. According to Bloomberg, the public feud erased $34 billion from Musk's personal net worth, the second-largest loss ever in the history of the Bloomberg Billionaires Index of the 500 wealthiest people in the world. Musk and Tesla did not respond to a request for comment. Tesla -- the electric car company that has been the biggest source of Musk's wealth as its stock price soared in recent years -- has been under pressure as its chief executive has spent time in politics, particularly in overseeing the U.S. DOGE Service. The company's shares are down more than 20 percent year-to-date, falling precipitously Thursday as the verbal warfare between Trump and Musk escalated before slightly rebounding Friday. The electric vehicle company has already suffered steep losses from the blowback to his work with the Trump administration, culminating in a 71 percent decline in profit in its latest quarter and a double-digit percentage slip in sales. Analysts estimate the company will suffer even more from Trump's proposed spending and tax bill, which would largely end the $7,500 federal tax credit for electric vehicle buyers that has helped drive demand over the years. That would translate to a hit of about $1.2 billion to Tesla's full-year profit, according to analysts at JPMorgan. There are also several open federal investigations into Tesla's driver-assistance technology, and the National Highway Traffic Safety Administration last month sent Tesla a letter of inquiry to understand how Tesla plans to launch its robotaxi and the safety measures it is taking. The letter was a sign that the scrutiny on Musk's company might continue, despite his involvement with the administration. Musk has been gradually pulling back from his role in the government, with a promise to return his attention to his business empire. He is betting heavily on the launch of robotaxis in Austin this week to reverse Tesla's fortunes and appease investors. Last week, he wrote on X that Tesla has been testing self-driving Model Y cars. Musk is also contending with angry shareholders who are calling on the CEO to step up or resign. Last week, a group of activist Tesla shareholders sent a letter to board chair Robyn Denholm calling for guarantees that Musk will devote at least 40 hours a week to the electric-vehicle maker after spending much of the past year focused on politics. Brad Lander, the New York City comptroller who oversees the NYC public pension system that holds more than 3 million shares of Tesla, said Thursday's "schoolyard fight" between Trump and Musk is "another reminder of how disastrous this White House and its DOGE experiment have been for Tesla shareholders." Lander -- who is running for New York mayor -- said that the NYC pension systems lost more than $150 million in value in a single day. "This should be a wake-up call for all Tesla shareholders watching silently from the sidelines," Lander said. The feud also comes at a tender moment for Musk's other companies. Musk is making ambitious bets in increasingly crowded spaces -- artificial intelligence and robotics -- that could emerge as rich landscapes for policymaking and regulation. His artificial intelligence start-up xAI is a competitor to OpenAI, which has established an early lead in the race to deploy AI-powered tools for consumers. (The Washington Post has a content partnership with OpenAI.) Musk is also seeking to bring brain-computer interfaces, where computer chips are implanted in brains to enhance human function, to the mainstream with another of his companies, Neuralink, that operates in a heavily regulated space. Meanwhile, the threat by Trump on Thursday to cancel SpaceX's government contracts sent shock waves through the federal bureaucracy, which has grown reliant on SpaceX for several critical missions. While federal procurement officials say terminating SpaceX's contracts is highly unlikely, the threat highlighted how dependent the government has become on SpaceX and prompted federal officials to encourage other space companies to accelerate their investments in alternatives. Musk's company provides the only way NASA can fly astronauts to the International Space Station. SpaceX also launches sensitive satellites for the Pentagon and intelligence agencies. Over the years, SpaceX has leveraged billions of dollars in federal funding to build a robust commercial business. But it is still heavily reliant on funding from NASA and the Pentagon. Ross Gerber, a Tesla investor who was once a vocal Musk supporter, estimated that the loss of government funding for SpaceX would cut the company's value in half. For months, Musk was a constant at Trump's side as he led DOGE and oversaw sweeping layoffs and budget cuts. Investors hoped his alliance would deliver big returns for his companies: They imagined the relationship would cool Biden-era investigations into Tesla, ease regulations to speed the rollout of autonomous vehicles and give him an edge in securing lucrative contracts for his rocket company. That marked a stark shift from Musk's relationship with former president Joe Biden, whose administration excluded Tesla from an electric vehicle-focused event on the White House lawn. Trump, by contrast, hosted what resembled a Tesla infomercial at the White House in March, where five Teslas were parked in the driveway -- and the president even selected a cherry red one for himself. But some investors say he risks leaving Washington worse off than when he came. "Who can run in and take the phone from him [Musk]?" asked Gerber, who has emerged as a critic of Musk's actions and on Thursday sold half his position in Tesla. "You cannot get up in the morning and just spit on all your friends and people who literally create the success that you have."

Musk and Trump are over. Silicon Valley is just getting started.

After the fallout, the tech elite is staying quiet -- focusing on where they can win. It would have been another banner day for Silicon Valley's blossoming alliance with Washington -- if only President Donald Trump and Elon Musk hadn't been attacking each other online. While the two men traded barbs on their respective social networks, a cryptocurrency company whose business had been hamstrung by the Biden administration went public on the New York Stock Exchange, its share price popping 200 percent. An artificial intelligence company heralded a new product designed to help the national security establishment. And the defense tech start-up Anduril raised $2.5 billion to expand its efforts to get Pentagon contracts. The spate of business deals from companies looking to curry goodwill in Washington helps explains why many in Silicon Valley say they intend to stay quiet and stick by him for now. Even as ideological differences strain the political coalition of the tech right and MAGA, the Trump administration thus far has been good for Silicon Valley's bottom line. Musk had tried and failed to enact systemic change across the entire government. Many tech executives and investors who support Trump have narrower goals that focus on creating a regulatory climate favorable to the industry. At that, they appear to be succeeding: Over the past year, a broad group of influential figures in the tech world has built deep ties, independent of Musk, to the White House and to federal agencies. Those alliances have cemented the industry's positions on cryptocurrency, artificial intelligence and defense and laid the groundwork for a wave of changes in government policy that will benefit tech companies for years to come. The group has installed allies in key positions, including former Uber executive Emil Michael, who was recently confirmed to a top Pentagon position, and tech investor and podcaster David Sacks, who serves as the White House's cryptocurrency and AI czar. Their future may be shakier without Musk, but both men remain close to the president and Vice President JD Vance, said people familiar with the dynamic, who spoke on the condition of anonymity to describe personal relationships. And the cryptocurrency industry, which showered Trump and congressional Republicans with campaign donations, has grown closer to Trump as his family has pursued its own lucrative crypto ventures. Even as Musk's crusade to rein in government spending flamed out, other tech figures are seeing their investment in Washington pay off: Palantir, the data analysis company co-founded by Peter Thiel, who was a mentor to Vance, raked in hundreds of millions of dollars in new contracts, including with the Pentagon. In May, the Trump administration brokered billions of dollars in deals for artificial intelligence companies in the Middle East. Trump repealed President Joe Biden's executive order that placed guardrails on AI, a move heralded by Trump supporters in tech. The Trump-Musk breakup and the future of the industry's alliance with the White House remain tricky subjects for industry figures, most of whom have avoided speaking publicly about it. The popular industry podcast All In announced an emergency show Thursday, then never posted a show, with one of the hosts saying, "I've decided to take a beat & not comment on the Trump & Elon donnybrook." Speaking on the condition of anonymity, however, Silicon Valley figures mostly say they were not surprised by the sudden breakup between the two combative egos, and some add that they aren't worried either. "The [fallout between the men] was inevitable, but I didn't think it would be this fast or this spicy," said a tech executive who operates in Washington and works in the aerospace arena, who spoke on the condition of anonymity to speak about personal relationships. But the person said he doubted the acrimony would have an influence on the broader agenda. "Most of the tech right is a better politician than Elon," he said. Some who had backed Musk's crusade, however, said they were torn about the future of the coalition. "Musk being in the room meant a lot to me, as a voter and as a believer," said another technology executive and Musk friend, who also spoke on that condition of anonymity to share his views freely. <b>An awkward alliance</b> The political coalition uniting the populist MAGA movement with the world's richest tech executives has always been tenuous. The alliance began to show cracks just before Trump's inauguration with a fight over H1B visas. "Immigration -- that was the first time we saw a split between the MAGA right and tech right," said Sheel Mohnot, co-founder of Better Tomorrow Ventures, a financial tech investment firm in San Francisco. But the fissure was at least temporarily resolved when Trump sided with Musk and the tech industry, a sign of the strength of the Musk-Trump relationship at the time. In recent months, new fault lines have surfaced as Trump administration policies on student visas and cuts to government grants for science have imperiled the pipeline for tech talent and innovation. A further gap opened over Trump's tariffs. "There was a marked shift around Liberation Day," Trump's label for April 2, when he announced his sweeping tariff hike, said a well-known tech investor. "It was very hard to get these folks to say anything negative about Trump. Then it was the opposite," said the investor, who spoke on the condition of anonymity to avoid retaliation. Musk served as an avatar for these frustrations, vocally criticizing the president's tariffs on X, where he has 220 million followers, and personally lobbying Trump behind the scenes. Ultimately, Trump created a temporary exemption to the tariff plan for semiconductors and other electronics -- a concession to the industry. But the lack of broader changes was a sign of Musk's waning influence in a White House where he was already unpopular. Around the same time, tech figures began to emphasize their own agendas and distance themselves from Musk. The U.S. DOGE Service was only referenced in passing at May's Hill and Valley Forum, a conference for technology executives seeking military and space contracts. Senators and other politicians came to the conference to herald a new chapter in the relationship between the tech world and Washington, even as Musk was on his way out. As cracks have appeared in the tech-MAGA coalition, tech figures have understood that they have much to gain from staying in the fold, said Mohnot. "They were willing to go along with a lot of the [expletive] from the MAGA right because they thought they were getting all this other stuff," he said. A tech executive who also spoke on the condition of anonymity said it had been useless to try to persuade Musk to elevate specific issues with Trump, because he was entirely focused on his crusade to discover fraud and abuse in government spending. "People [in Silicon Valley] understood that you have to work within a framework, and Musk just has no interest in working in any type of framework," the person said. "With whatever he is doing, he is just in his own universe." For the time being, some tech leaders said, staying quiet is not only safe, but relatively easy. "We're not in the middle of elections. There's so much less pressure to pick a side. No one's asking you, 'Who are you voting for?'" said John Coogan, a former entrepreneur-in-residence at Thiel's Founders Fund, and co-host of the industry's favorite new podcast, Technology Brothers Podcast Network (TBPN). "There's just so many outs, I would be surprised if we see people take a really strong side." And the tech world is aware that loyalty matters in Trump's universe. The tech right "likely has plans for what comes after Trump," said a cryptocurrency executive, who also spoke on the condition of anonymity to describe a sensitive topic. "And I think they know that to continue to build a coalition, you need MAGA."

Cathie Wood on what Trump and Elon Musk's feud reveals

The clash between Elon Musk and President Donald Trump isn't just political theater; it's a look into how deeply Musk's empire depends upon the U.S. government, according to a top investor. Ark Invest CEO Cathie Wood says investors are waking up to the extent of this reliance amid the escalating spat. In a YouTube video on Ark Invest's channel, Wood looked at the web of federal contracts, regulatory oversight, and political stakes that underpin Musk's companies -- namely: Tesla (TSLA), SpaceX, and Neuralink. "I think the way this is evolving is Elon, Tesla, and investors are beginning to understand more and more just how much the government has control here," Wood said. "Elon is involved in companies that are depending on the government." She noted that SpaceX has $22 billion in government contracts, and regulatory decisions on everything from Tesla's robotaxis to Neurolink's FDA approval can make or break Musk's ventures. Regulation of Tesla's autonomous vehicles, for example, could accelerate dramatically if federal rules replace a state-by-state patchwork. So the tension with Trump is a real factor shaping Musk's business strategy, and as a result, Wood said the Tesla CEO might be "beginning to walk [some threats] back," such as his threat to mothball the Dragon spacecraft, which brought back stranded astronauts from the International Space Station. The feud between the Tesla CEO and the president erupted when Musk criticized Trump's "big, beautiful" domestic policy bill (which includes cuts to electric vehicle subsidies) and started name-calling the bill ("a disgusting abomination") and alleging that the president was in the Epstein files. Trump fired back, threatening to pull government contracts -- sparking a 14% one-day plunge in Tesla's stock. The president recently called Musk "the man who lost his mind." While the market volatility was sharp, Wood suggested that the clash partly reflects Musk's strategic move to distance himself from "being associated with one party or the other" and that his recent steps to dial back certain initiatives could signal a recalibration to protect those interests -- something that was "partly, not entirely, orchestrated." She added, however, that "clearly, there has been some brand damage to Tesla, which [Musk] readily admits." Wood said there are bigger ambitions at play here: Both Musk and Trump want to "change the course of history." But she said the constant infighting is counterproductive -- "Trump is not going to be the greatest president ever if he's bogged down in one fight after another," she said, and Musk "doesn't need to get bogged down, either." She also highlighted the geopolitical angle: "President Trump is negotiating in a very tough way with China," and "China is a big part of Tesla's business, both production and consumption." The recent news that China reopened rare earth materials exports to Detroit's Big Three automakers -- but not Tesla -- shows just how high the stakes are for Musk's companies. Despite all the recent volatility, Wood remains optimistic about Tesla's future. At a conference Monday in Florida, she reiterated her ambitious $2,600 price target for the company's stock and said it'd the company she'd invest in if she could only invest in one. Why? Well, at both the conference and in the YouTube video, she cited Tesla's advancements in robotaxis and robotics -- which are "becoming a bigger part of the [company's] story" -- as well as AI and energy storage. She said the company will want to shift the narrative to its June 12 robotaxi launch, which could help the company reclaim a top spot in the auto industry as its market share has slipped amid growing EV competition and "because of all the drama." And despite the president saying he has "no intention" of speaking with Musk, Wood thinks the Tesla CEO can get the company back on track. Musk, she said, "works really well under pressure" -- and "he creates a lot of that chaos and pressure himself."

Elon Musk Could've Saved EVs From Donald Trump. That's Not What Happened

It didn't take long for Donald Trump to fall back on old habits. As soon as his disagreements with his former cost-cutter-in-chief, Tesla CEO Elon Musk, spilled into public view, Trump pulled out some of his most time-tested anti-electric vehicle takes. "I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!," the president posted on his social media platform Truth Social yesterday. And speaking to reporters at the White House, Trump added: "All of a sudden [Musk] had a problem, and he only developed the problem when he found out that we're going to have to cut the EV mandate, because that's billions and billions of dollars." It is true that since leaving his post as the head of the so-called Department of Government Efficiency, or DOGE, Musk has railed against Trump's signature budget legislation, dubbed the "Big, Beautiful Bill." It is also true that -- at least according to a Congressional Budget Office analysis -- that bill could add $2.4 trillion to the federal deficit over the next decade, which Musk says is his problem with the legislation. And it is also true that the Big, Beautiful Bill will end the federal EV tax credit program and likely hurt the growth of the electric market in America. Everything after that gets a bit murky. But since this feud likely won't end well for EVs or for Tesla, it's worth asking where Musk stood on the electric tax credit question in all the months he spent funding Trump's presidential campaign and then operating out of his White House. Aside from the Tesla-only car show he put on in March as the automaker's stores became known more for protests than as places to actually buy cars, Trump's stance on EVs has been largely consistent over the years. In a 2023 Christmas message, he told those supporting "All Electric Car Lunacy" to "ROT IN HELL." He routinely criticized President Joe Biden's pro-EV policies as promoting a "hoax" that would destroy the auto industry. He frequently repeats the claim that EVs "can't go far," even as range and performance increase dramatically with each passing year. And his administration has been adamantly pro-fossil-fuel, as well as staffed extensively with veterans of that industry. But politics makes strange bedfellows, as they say. Given Trump's pro-gas proclivities, the partnership between him and Musk -- CEO of the world's largest- or second-largest EV maker and godfather of the modern EV industry -- always felt unusual. At most, Trump offered a concession that he "[has to be]... for electric cars, because Elon endorsed me very strongly," which is not exactly a ringing endorsement. Their relationship was always more rooted in Musk's far-right political turn in recent years, and his apparent hatred for excessive government spending, than anything else. That was how things looked on the surface, anyway. Anyone looking a little closer could quickly realize that Musk's support of Trump was heavily transactional and stemming from his desire to clear out regulations in the way of his businesses -- namely, autonomous vehicles, artificial intelligence and space travel. Musk was quite direct about this last October: "There should be a federal approval process for autonomous vehicles," Musk said on a third-quarter earnings call, instead of a state-by-state patchwork of rules. Then Trump won the election and Tesla's stock price surged on the idea that the "First Buddy" would ensure that future autonomous vehicle rules would specifically benefit the technology he's betting the company's future on. EVs themselves didn't seem to come up much in the Trump-Musk bromance. Certainly, there was never a moment where Trump appeared to be visited by three ghosts one evening and then decided it was essential to keep the Biden-era EV buying and manufacturing credits even as a way to stay ahead of China in the space, or even help Musk keep the cash flowing. "I'll tell you, he's never called me and said, could you lay off the electric car?" Trump told Fox News last year. And given the choice between following the president's will and keeping EV manufacturing jobs alive in their districts, members of Congress firmly went with Option One. If anyone could have prevented this outcome, it was Musk. And yet, that's not where the United States seems to be headed. Musk never seemed to address this disconnect, either. In a late January Tesla earnings call, he was asked by an analyst about his views on what EV policy should be in the Trump era. Musk demurred and essentially said: the EV transition is going to happen anyway, so I'm not worried about it. "At this point, I think that sustainable transport is inevitable," Musk said. "I'm highly confident that all transport will be autonomous, electric, including aircraft, and that simply, it can't be stopped." During that time, as sales to Tesla's typically liberal, coastal buyers declined, it's not like heartland conservatives rushed in to pick up the slack. There was a fundamental misalignment between Musk's politics and the audience for the cars he sells, a circle he could never quite square. It also wasn't always his first priority. Musk moved mountains in recent months to shift American policy and government spending to better align with his worldview. The country, and perhaps everyone on Earth, may feel the lasting effects of DOGE for a very long time. If Musk wanted to secure a future for zero-emission transportation in America, he likely could've done it more, better and harder than anyone else. But now he and Trump are on the outs, and Trump is back to business as usual when it comes to EVs. One other thing is objectively true: when Trump feels he's been slighted, he does not just let it slide. Unless the two find a way to make nice, this feud doesn't feel like it will bode well for Musk, or Tesla, or EVs in America, or even Tesla's role in the autonomy race. When we'll see any fallout from the end to this bromance remains to be seen.

From allies to enemies: the cost of a Musk-Trump split

Washington (AFP) - The bitter clash between Elon Musk and Donald Trump has drawn a spotlight on the South African-born tycoon's businesses. Here is a look at his affairs as their White House partnership turns toxic, with billions of dollars in market value and government contracts hanging in the balance. Tesla The Tesla car company is the cornerstone of Musk's business empire and has suffered considerably since the entrepreneur dove into politics. The electric vehicle giant's stock has plummeted more than 20 percent since the start of the year, reflecting investor anxiety about Musk's increasingly polarizing public persona. The damage reached a fever pitch on Thursday when the Musk-Trump feud erupted out in the open. In a matter of hours, Tesla shed more than $150 billion in market capitalization, wiping $34 billion from Musk's personal fortune. The alliance with Trump was supposed to have been Tesla's golden ticket, even if the administration was going to scrap tax credits that had helped it become an automobile juggernaut. More importantly, Musk could count on Trump's blessing for his ultimate vision: putting fully autonomous vehicles on American roads. This ambition has been stymied by government regulation over the years, with authorities slowing efforts due to worries that the technology is not ready to hit the road at mass scale. The Trump administration was expected to lift these regulatory constraints -- a promise now in serious jeopardy. "Musk needs Trump because of the regulatory environment, and you can't have Trump go from friend to foe," said analyst Dan Ives of Wedbush Securities. The administration also regulates vehicle design and would influence the mass production of robotaxis that Musk intends to launch in a pilot program in Austin, Texas, this month. Musk's hard-right political pivot has alienated the very customers Tesla needs most: environmentally conscious and liberal-leaning buyers who once saw the brand as aligned with their values. Some drivers have resorted to bumper stickers declaring their cars were purchased "before Elon went crazy." The damage is showing up in sales figures. In Europe, while overall electric vehicle sales climbed, Tesla's market share crashed 50 percent in April as attention focused on Musk's political activities and the company's aging product lineup. A recent Morgan Stanley survey said 85 percent of investors believe Musk's political involvement is actively harming Tesla's business. SpaceX A prolonged battle with Trump poses existential risks for SpaceX, Musk's space exploration company that has become NASA's most critical partner. SpaceX and NASA are deeply interdependent. SpaceX depends on government contracts worth tens of billions of dollars, while NASA relies on SpaceX for everything from astronaut transportation to satellite deployment. SpaceX's portfolio includes some of the most sensitive national security projects: launching astronauts to the International Space Station, building spy satellites and operating the Starlink satellite network. The financial windfall has been enormous, with a December share sale valuing SpaceX at $350 billion -- $140 billion more than just six months earlier, largely due to anticipated government largesse under Trump. In the heat of the clash on Thursday, Trump threatened to cut off all government contracts, while Musk said he would mothball the Dragon spacecraft, which is vital for ferrying astronauts to and from the International Space Station -- though he later walked back this threat. xAI Musk has huge plans for his xAI artificial intelligence company. He's angling to compete with OpenAI, the ChatGPT-maker that was co-founded by Musk a decade ago and is now steered by his archrival Sam Altman. Altman has his own inroads to the White House, where he signed a massive AI infrastructure initiative called the Stargate Project, which recently expanded to Saudi Arabia and Abu Dhabi. Initially dismissing Stargate as unrealistic, Musk later worked behind the scenes to undermine the project, reportedly telling investors that Trump wouldn't approve any expansion that excluded xAI. Adding another layer of complexity, Musk folded X (formerly Twitter) into xAI earlier this year. Musk's $44 billion acquisition in 2022 transformed the site into the go-to platform for conservatives, but Trump himself remains an infrequent user, preferring his own Truth Social platform for communication.

Musk's empire at risk after Trump feud opens multifront fight

What began as Elon Musk's embrace of right-wing populism has become a defining -- and potentially harmful -- chapter in his business career. By endorsing Donald Trump's MAGA movement and far-right parties in Europe, Musk alienated a big portion of his original customer base, eroding Tesla's brand, sales and market share around the globe. Then came this week's rupture: a personal and public breakup with Trump that prompted threats of retaliation from a man with control over the world's most powerful government. By simultaneously burning bridges with both his customers and now the political movement he funded and amplified for months, Musk now faces a rare convergence of threats: collapsing brand loyalty, shaky revenues, and mounting legal and regulatory risk. Tesla's sales are already stumbling under the weight of partisan baggage. SpaceX, long seen as a strategic national asset, is facing new scrutiny as political winds shift. And the green shoots at X -- Musk's $44 billion "free speech" experiment -- that were fueled by Musk's proximity to the White House and the ad dollars that followed, may soon disappear. "Elon isn't functioning to the benefit of his shareholders," said Ross Gerber, the CEO of Tesla shareholder Gerber Kawasaki, which has been reducing its Tesla holdings over the last few years. Speaking on Bloomberg Television on Thursday while the meltdown was still going on, Gerber said Musk's behavior is leading to the "dismantling of the Musk empire in real time." With enemies on both flanks, Musk finds himself at the center of a storm fueled by consumer revolt and political hostility. "Nobody on the right is going to buy a Tesla, nobody on the left is going to buy a Tesla. Elon is a man without a country," said Steve Bannon, an outside adviser to Trump who has long been critical of Musk, in an interview. Bannon says he is "in continual conversations at the most senior levels" of the Trump administration to push them to revoke Musk's security clearance and use the Defense Production Act to seize SpaceX and Starlink on grounds they're vital to U.S. national security. Even if Trump doesn't take such extreme measures, there is no shortage of retaliatory options for the White House. The president could try to wield the power of agencies like the Securities and Exchange Commission, the National Highway Traffic Safety Administration and the Federal Aviation Administration to inflict real harm -- or even just incessant regulatory morass -- onto all of Musk's businesses and the source of his wealth. In just one day, the Musk-Trump spat shaved $34 billion from his personal net worth, the second-largest loss ever in the history of the Bloomberg Billionaires Index of the 500 wealthiest people on the planet. The only bigger wealth hit: his own wipeout in November 2021. Tesla lost $153 billion of market value Thursday, with shares reversing course Friday after Musk began to simmer down. Musk has faced deep stretches of financial pain before. There are flanks of skeptics who have, over the years, called for his impending demise only to be proven wrong by the world's richest man and his cult following of fans and funders willing to throw ever-growing sums of money at his ambitions. Most famously, Tesla flirted with bankruptcy only to reverse course and become the biggest electric vehicle seller in the world. Musk's $44 billion purchase of X was widely panned as the company's debt languished on banks' books, only to see those fortunes reversed after Trump's election. "Musk has a habit of teetering on the edge of destruction and pulling himself back just in the nick of time," said Nancy Tengler, whose firm holds 3.5% of its growth portfolio in Tesla stock, in a Friday interview on Bloomberg Television. Tengler, CEO and chief investment officer of Laffer Tengler Investments, said her firm has been adding Tesla shares in recent months but now has a "full position." "He needs to dial down the rhetoric and the drama and get back to the business," she said, as investors own Tesla stock for growth, not for "the histrionics." To pull off a rebound this time around, Musk is going to have to persuade people to start buying his electric vehicles at a faster clip and reverse the painful sales slide in the U.S., Europe and around the world. He's also going to have to attract riders to his new robotaxi service in Austin, Texas, as the company makes a gigantic bet on artificial intelligence, robotics and self-driving cars. Musk has lobbied lawmakers to help clear a path for driverless vehicles, something Trump initially endorsed. It's now unclear if the Trump-Musk fallout complicates the regulatory environment for autonomous vehicles and potentially slows the path forward for Tesla's robotaxi network. "The disagreement will not help Tesla demand but could potentially (temporarily) alienate multiple sides of the political spectrum," said Morgan Stanley analyst Adam Jonas in a research note entitled "Well That Escalated Quickly ..." Jonas said emotions are "running high" and that he's sticking to his long-term $410 price target on Tesla's share price but is bracing for near-term volatility and is "prepared for the stock to give up more." Other tests in the coming weeks may include a $5 billion debt offering of the billionaire's AI company, xAI, as well as funding rounds for xAI and SpaceX. Musk recently closed a $650 million late-stage raise for his neurotechonlogy company Neuralink from big investors including Sequoia Capital, ARK Investment Management and Founders Fund. From a legal and regulatory perspective, there's even more at stake for Musk if the Trump administration turns on the billionaire and claws back contracts like the president threatened Thursday. SpaceX, one of the world's most valuable startups with a market value of $350 billion, has received more than $22 billion in unclassified contracts from the Defense Department and NASA since 2000, according to data from Bloomberg Government. It launches critical national security satellites for the Pentagon and the U.S. is depending on the Musk-led company to develop a spacecraft to put American astronauts on the moon in as little as two years. Musk's vow to decommission its all-important Dragon spacecraft, which ferries cargo and people to the International Space Station for the U.S., sent shock waves throughout the industry. Following through with the threat, which Musk later walked back, would sever a vital part of the U.S. space program. "It is untenable to have a CEO of a prime defense and aerospace contractor threaten to shut down services the government has contracted with them to perform," said Lori Garver, a former NASA deputy administrator under former President Barack Obama. Garver says NASA needs SpaceX, but that SpaceX's business model also depends, in part, on the U.S. government. "Elon has already walked back decommissioning Dragon, because they do require now, as a big part of their business plan, government contracts. But they provide a service for those contracts. So it's a symbiotic relationship," Garver said. On a more day-to-day basis, government agencies could try to inflict pain on Musk's businesses by delaying everything from space launches to satellite service to robotaxi expansion. Investigations into publicly traded Tesla or the finances of his companies could include the SEC, as well as antitrust probes and Federal Trade Commission interest around social media moderation, data use or AI. So far, Musk and Trump may be trying to at least press pause on the public spectacle. White House officials say Trump plans to focus his attention on inflation and the economy rather than speak to Musk, and insinuated without evidence that the billionaire was agitating for a call with the president. (In a pair of posts on his social media platform Friday morning, Trump intensified his push for Federal Reserve Chair Jerome Powell to lower rates.) As for pulling Musk's government contracts, Trump hasn't yet pursued any steps to follow through with his threats, one of these people said. He is, however, thinking of getting rid of his Tesla.

5 winners from the Trump-Musk breakup

The vicious blow-up between President Trump and Elon Musk has shaken up the power dynamics in Washington, D.C. As Musk burns his bridges to the White House and MAGA world, several of his political and business rivals stand to benefit. And while Musk's enemies may relish his ouster, some of Trump's biggest rivals could also gain from the president's feud with the world's richest man. Here are the people, businesses and factions that could win from Musk's loss. Jeff Bezos and Blue Origin Musk's alienation from Trump gives Jeff Bezos a major opportunity to improve his tumultuous relationship with the president and fuel the growth of Blue Origin, his aerospace company. Even before Musk's alignment with Trump, he and Bezos butted heads for years as the billionaires dueled each other for dominance over the private sector space race. At the same time, Bezos was fending off Trump's attacks on the Washington Post and facing off with the administration in court. Musk's SpaceX had already cemented itself as the industry leader before joining forces with Trump, far outpacing Blue Origin in total launches while also servicing the International Space Station. But Musk's growing ties to Trump threatened to deepen SpaceX's connection to the government and siphon billions of dollars in federal contracts away from Blue Origin. With Musk out of Trump's good graces, Bezos now has an opening to build on months of work to curry the president's favor. Ahead of the 2024 election, Bezos spiked the Post's pending endorsement of former Vice President Harris, a move critics derided as self-interested. In an op-ed for the Post, Bezos said that his decision was made based on editorial principle alone, but acknowledged how his business empire has become a "complexifier" for the paper. Musk's exit is another win for Boeing after months of progress moving forward from a series of scandals and safety lapses. As Boeing faced federal investigations into its safety protocols for commercial aircraft, it also suffered an embarrassing setback in its spacecraft efforts during the Biden administration. Astronauts Butch Willmore and Suni Williams spent months stuck on the ISS after taking off from Earth on Boeing's Starliner in June 2024. What was supposed to be a week-long mission turned into a nine-month ordeal in which several Starliner maintenance issues delayed their return to Earth. Former President Biden rejected Musk's offer to bring Wilmore and Williams home with the SpaceX Dragon, but the administration refused amid its own feud with the tech CEO. The Biden administration held an electric vehicle summit earlier in his term, but snubbed Musk, sending the Tesla CEO on his path toward endorsing Trump. Wilmore and Williams finally returned to Earth in March after Trump dispatched the Dragon to bring them back. Musk threatened Thursday to ground the Dragon amid Trump's threats to scrap SpaceX's federal contracts, which would have debilitated the U.S. space program. While Musk has since pulled back from that threat, his feud with Trump gives Boeing an opening to move forward from the Starliner mishap. Sam Altman and OpenAI Before this week, Musk's most notable falling out with an ally may have been his feud with OpenAI CEO Sam Altman. Musk, one of the co-founders of the nonprofit artificial intelligence (AI) firm behind ChatGPT, has battled Altman in the courts and on the Internet over his leadership. He had consistently criticized Altman for plans to make OpenAI a for-profit business -- plans that have since been scrapped -- and sued the company for an alleged breach of its commitments. Musk has also launched xAI, one of several rivals to OpenAI, and incorporated the Grok chatbot into X, the social media platform formerly known as Twitter. Trump, however, ignored Musk's disdain for Altman and made OpenAI a major player in Project Stargate, his effort to build out AI data and energy centers. Musk was forced to abide Trump's partnership with Altman, and the president dismissed his adviser's beef with OpenAI when touting the benefits of the deal. "No it doesn't. He hates one of the people in the deal," Trump said in January when asked if Musk's criticism bothered him. "I've spoken to Elon. I've spoken to all of them, actually. The people in the deal are very, very smart people," Trump continued. "But Elon, one of the people in the deal he happens to hate, but I have certain hatreds of people too." With Altman's arch rival out of the White House, the path is clear for an even bigger role in Trump's efforts to boost AI. Trump's anti-immigration alliance While Musk shared Trump's support for stricter border security, he spent his stint with the president at odds with some of the Trump's closest advisers and major MAGA movement leaders. Even before Trump took office, a war over H-1B visas erupted between Musk and several Trump allies, who are fiercely opposed to courting immigrants and back Trump's severe immigration restrictions. Musk squared off with former Trump strategist Steve Bannon and right-wing activist Laura Loomer over the H-1B program. "I will go to war on this issue the likes of which you cannot possibly comprehend," Musk, reportedly a former H-1B recipient, wrote in one of several posts on the social platform X defending the visas. While the tech CEO said H-1Bs were essential for U.S. competitiveness, Bannon and Loomer accused Musk of supporting a "scam" that would undermine Trump's America First platform. Musk has also butted heads with Stephen Miller, a top Trump White House policy advisor and the architect of much of the president's immigration restriction agenda. In recent days, Miller has been front and center in defending Trump's tax cut and spending bill, the measure behind the rupture between Musk and Trump. "The reconciliation bill cuts taxes, seals the border and reforms welfare. It is not a spending bill. There is no 'pork.' It is the campaign agenda codified," Miller said on X Thursday, a clear swipe at Musk, if not by name. Democrats have had a miserable start to 2025, but the Musk-Trump feud is undoubtedly good news for the time being. The messy online battle between Trump and Musk gave Democrats some relief from months of ineffectual attempts to impede the president's agenda, recriminations over the 2024 election, divisions about their future and a lack of clear leadership, resulting in historic unpopularity. "Oh, man, the girls are fighting, aren't they?" Rep. Alexandria Ocasio-Cortez (D-N.Y.) quipped Thursday. "We'll see what the impacts are of it legislatively." Trump, eager to quash a distraction from his legislative push, sought Friday to ice the feud with Musk and move forward. But one first-term Trump White House aide said Musk's alienation could lead to further fractures in the GOP, which could give Democrats some room to breathe after a brutal six-month stretch. "We think we've seen some real legislative gridlock -- but with new life and momentum breathed into the Freedom Caucus' power, I don't think we've seen anything yet," the former White House aide said. "At a time when Republicans need to be united more than ever, the most dangerous faction I've seen could be accelerating quickly -- and congressional leadership may soon find they have less control than ever." Democrats were already banking on Musk being an electoral liability in next year's midterm elections, though were wary of drawing his money into the race. If Musk follows through on threats to punish Republicans who voted for Trump's bill, the divided field could boost Democrats even further. "He's already suggested Republicans wouldn't have kept the House without his help, and while he previously downplayed any plans to get politically involved, that's harder to believe as the rhetoric between him and Trump heats up," the former White House aide said. "The midterms are a prime opportunity to back up that claim -- and in swing districts where a couple million dollars can tip the scales, his involvement could be a game-changer."

Trump-Musk Row Slams Tesla Shares, $150 Billion in Market Value Wiped Out

Trump alleges Musk was upset as the bill revokes tax benefits on EVs Tesla shares went into free-fall on Thursday as President Donald Trump publicly feuded with the electric vehicle maker's billionaire CEO Elon Musk, his self-proclaimed "First Buddy." Investors watched the unfolding drama with growing worry about what the fracas could mean for Musk's business empire. The carmaker's shares ended the day down 14 percent, wiping off $150 billion (roughly Rs. 1,28,621 crore) in market value on a day absent other news about the company. Traders dumped Tesla in heavy trading after Musk quickly responded to Trump's criticism with social media posts that stepped up criticism of the president's tax bill. Trump fired back further, alleging Musk was upset because the bill takes away tax benefits for electric vehicle purchases. Openly feuding with Trump could pose multiple hurdles for Tesla and the rest of Musk's sprawling business empire. The US Transportation Department regulates vehicle design standards and would have a big say in whether Tesla can mass-produce robotaxis without pedals and steering wheels. The agency is also investigating Tesla's driver-assistance software, known as "Full Self-Driving," following a fatal crash. "Elon's politics continue to harm the stock. First he aligned himself with Trump, which upset many potential Democratic buyers. Now he has turned on the Trump administration," said Tesla shareholder Dennis Dick, chief strategist at Stock Trader Network. With EV sales falling, Musk over the last year has re-oriented Tesla's future around self-driving robotaxis. On an earnings call last year, he said investors "should sell their Tesla stock" if they did not believe the company would solve the technological challenges of driverless vehicles. Wedbush analysts have said the AI and autonomous opportunities could be worth $1 trillion (roughly Rs. 85,73,329 crore) alone in market value for the company. Musk has advocated for one federal approval process for autonomous vehicles to streamline the current maze of different state regulations. Ross Gerber, CEO of Tesla investor Gerber Kawasaki Wealth and Investment Management, said the feud with Trump "creates a negative force against Tesla" that could jeopardize regulations and risk more government investigations. "Every benefit that was perceived he would have got now turns into a negative," Gerber said. Musk, the world's richest man and a key figure in the Department of Government Efficiency's (DOGE) cost-cutting plan for several months, blasted Trump's "big beautiful bill" this week, after he decided to spend less time in the White House and instead focus on his companies. Following Thursday's selloff, his net worth fell by roughly $27 billion (roughly Rs. 2,31,557 crore) to $388 billion (roughly Rs. 33,27,310 crore), according to Forbes. Trump on Thursday said on his Truth Social platform that the "easiest way to save money in our Budget, billions and billions of dollars, is to terminate Elon's governmental subsidies and contracts." Transportation Secretary Sean Duffy has already moved to exempt autonomous vehicles from some safety requirements, and NHTSA said in April it is "actively engaged in developing a multi-faceted regulatory framework" for autonomous vehicles. Although the federal government has already started to streamline some regulations around autonomous driving, Morningstar analyst Seth Goldstein said regulators might possibly craft rules in a way that would single out Tesla. Most autonomous vehicle companies use sensors such as radar and lidar to detect objects, for example, but Tesla relies solely on cameras. Goldstein said federal regulators might devise rules requiring lidar, which would hurt Tesla. "With President Trump, being on his bad side always creates risk that you're going to get personal retaliation," Goldstein said. He doubted that such an outcome was likely, though, because many other companies have been pushing for new regulations for years. The stock has been on a roller-coaster ever since Musk endorsed Trump in mid-July 2024 in his re-election bid, gaining 169 percent from that point through mid-December. That was followed by a 54 percent slide through early April as a "Tesla Takedown" protest intensified. Musk's leadership of DOGE and alignment with the Trump administration had put off some car buyers, with sales slumping in Europe, China and key US markets like California. The House of Representatives version of Trump's budget bill proposes largely ending the popular $7,500 (roughly Rs. 6.43 lakh) EV subsidy by the end of 2025. Tesla and other automakers have relied on incentives for years to drum up demand, but Trump promised during the transition to end the subsidy. Tesla could face a $1.2 billion (roughly Rs. 10,290 crore) hit to its annual profit, along with an additional $2 billion setback to regulatory credit sales due to separate Senate legislation targeting California's EV sales mandates, according to J.P. Morgan. The company is still the most valuable automaker worldwide by a long shot. Through Wednesday, Tesla's market value stood at about $1 trillion (roughly Rs. 85,73,329 crore), well above Toyota Motor's $290 billion (rough Rs. 24,87,019 crore). "There were a lot of people excited about Tesla because the political winds were at his (Musk's) back. And now they've turned into headwinds in a lot of different ways," Steve Sosnick, chief strategist at Interactive Brokers, said. Tesla trades at 150 times profit estimates, a steep premium to other Big Tech stocks such as Nvidia. "I am short Tesla. I don't understand it. I don't understand its valuation. I don't understand its fundamentals. I think it's overhyped," Bob Doll, Crossmark Global Investments chief investment officer, said. © Thomson Reuters 2025

If Elon Musk and President Donald Trump divorce, who gets Silicon Valley?

Elon Musk's fallout with Donald Trump threatens Silicon Valley's political ties, as tech leaders who followed Musk in supporting Trump may now face tough choices. Once seen as a key link between tech and Washington, Musk's rift could jeopardise industry influence and benefits tied to AI, crypto, and satellite policy.Last year, Elon Musk was the Pied Piper of support for Donald Trump among Silicon Valley power brokers. One by one, tech billionaires close to Musk who had either backed Democrats or avoided the political scrum put their money and their time behind the former president's bid to reclaim the White House. But the meltdown of the relationship between Trump and Musk on Thursday has thrown that cosiness into question. In the coming days, the billionaires who followed Musk to Washington may be forced to decide whose side they are on in this suddenly personal fight. For Silicon Valley, what appeared to be a once-in-a-lifetime opportunity to team up with decision-makers in Washington is looking precarious. Musk was the keystone of the tech industry's relationship with the Trump administration. Without him, it could be up to lesser-known figures, such as venture capitalist David Sacks, a close friend of Musk who has become the Trump administration's artificial intelligence and crypto czar, to maintain those ties. "This is a tale as old as time," said Venky Ganesan, a partner at venture capital firm Menlo Ventures. "Like Icarus, Elon is finding out that if you fly too close to the sun, your wax melts and you crash." Even before Musk announced that he was leaving Washington, there were growing questions about what exactly the tech industry's embrace of the Trump White House was accomplishing. The yearslong attempt by the Justice Department to break up Google? Still on track. The Federal Trade Commission's pursuit of Meta, Facebook's parent company? That just wrapped up in a Washington courtroom and is now in the hands of a federal judge. Tariffs on imported goods that could hurt device makers like Apple? Trump seems more determined than ever to see them through. "Much better to be aligned with principles than personalities," Ganesan added. "A lesson tech titans might want to learn." Representatives for the White House and Sacks did not immediately respond to requests for comment. Musk did not return an email request seeking comment. Throughout 2024, many of the tech industry's boldface names threw their support and hundreds of millions of dollars behind Trump, mainly because he promised to back away from regulating the cryptocurrency industry and keep the federal government's hands off artificial intelligence. Venture capitalist partners Marc Andreessen and Ben Horowitz surprised many when they announced they were supporting Trump, though Horowitz changed his mind when former Vice President Kamala Harris, a personal friend, entered the race. (He said, however, that their venture firm still endorsed Trump.) Many of their colleagues, such as the tech mogul hosts of the popular All-In Podcast, which includes Sacks, also endorsed Trump. For them, Trump has kept up his end of the bargain. He has not only pushed for the deregulation of crypto markets, his family's company has jumped headfirst into them. And Trump's domestic policy bill that angered Musk even contains a provision that would block states from regulating AI. Other tech industry leaders have not had as much luck. At Trump's inauguration, Apple's Tim Cook, Meta's Mark Zuckerberg, Amazon's Jeff Bezos, Google's Sundar Pichai and Musk formed a Mount Rushmore of tech bosses in the crowd behind the new president. Sergey Brin, a Google co-founder who once raced to the airport in San Francisco to protest the travel restrictions of Trump's first administration, was also there. So was OpenAI's Sam Altman, a fellow travel restriction protester. Jensen Huang, CEO Nvidia and relative newcomer to presidential circles, did not attend the inauguration but traveled to Trump's Mar-a-Lago resort in Florida to talk AI chips. Their results have been mixed. For a while, Cook appeared to have talked Trump out of the tariffs on Chinese imports that would have badly hurt Apple. But Trump changed his mind and created a different set of tariffs that directly targeted Apple. Huang has been blocked from selling chips to China over national security concerns but was awarded a license to sell hundreds of thousands of chips in the Middle East in data centre deals that also brought Altman's company to the table. Commerce Secretary Howard Lutnick told a room of AI leaders, lobbyists and lawmakers this week that the administration would invite foreign investment into AI data centres, reversing Biden administration restrictions. He was speaking at an event hosted by Washington AI Network and sponsored by Meta, Amazon, OpenAI, Microsoft and TikTok, where he announced the administration would rename the U.S. Safety Institute to the centre for AI Standards and Innovation to emphasize growth of the industry over regulation. "America must lead in AI, and that means embracing innovation while securing our infrastructure," Lutnick said. "The new centre for AI Standards and Innovation will help ensure developers have clear, trusted guidelines -- without unnecessary regulation -- so we can stay ahead in the global AI race." But if Musk's all-out hostility toward Trump continues, it is difficult to say how Trump will treat Musk's companies and Silicon Valley. Until this past year, Trump showed more interest in old industries like steel and cars and was critical of the tech industry's biggest companies -- as well as a few of the smaller ones. Many Trump supporters are still suspicious that Silicon Valley's peacemaking is just opportunism, and would be happy to see him become more hostile. Musk's rift with Trump could directly affect efforts in Washington to benefit his companies. At the Federal Communications Commission, SpaceX has intensely lobbied for more access to spectrum for its Starlink satellite wireless service. FCC Chair Brendan Carr has been a vocal supporter of Musk's satellite strategy and his business. At a SpaceX launch in November, Carr posted a photo of the launch with the words, "It's time to unleash America's space economy." Musk saw an opportunity after his Starlink satellite service was shut out of the $42.5 billion Broadband Equity Access and Deployment Program created during the Biden administration, which favored fiber internet service over satellite in hard-to-reach rural areas. Now much of that is up in the air, and Trump has threatened to target the many government contracts held by Musk's companies. "This has escalated very quickly, so this rupture absolutely could matter," said Blair Levin, of New Street Research and a former chief of staff to the FCC. Musk's satellite ambitions are tied up in policy debates in federal agencies, Levin said, and "politically it is very easy to tweak things in ways that are very unhelpful to Musk." In an update on the social platform X on Thursday afternoon, Musk posted a video of Trump standing next to a bright red Tesla, parked in front of the White House. "Remember this? @realDonaldTrump" Musk wrote.

Trump-Musk row slams Tesla shares, $150 billion in market value wiped out

Tesla's shares plummeted after a public feud erupted between Elon Musk and Donald Trump, erasing $150 billion in market value. Investors grew concerned about the potential impact on Musk's business empire as the two exchanged criticisms over tax policies and electric vehicle subsidies. The spat raises regulatory hurdles for Tesla's autonomous vehicle ambitions, potentially jeopardizing approvals and increasing government scrutiny.Tesla shares went into free-fall on Thursday as President Donald Trump publicly feuded with the electric vehicle maker's billionaire CEO Elon Musk, his self-proclaimed "First Buddy." Investors watched the unfolding drama with growing worry about what the fracas could mean for Musk's business empire. The carmaker's shares ended the day down 14%, wiping off $150 billion in market value on a day absent other news about the company. Traders dumped Tesla in heavy trading after Musk quickly responded to Trump's criticism with social media posts that stepped up criticism of the president's tax bill. Trump fired back further, alleging Musk was upset because the bill takes away tax benefits for electric vehicle purchases. Openly feuding with Trump could pose multiple hurdles for Tesla and the rest of Musk's sprawling business empire. The U.S. Transportation Department regulates vehicle design standards and would have a big say in whether Tesla can mass-produce robotaxis without pedals and steering wheels. The agency is also investigating Tesla's driver-assistance software, known as "Full Self-Driving," following a fatal crash. "Elon's politics continue to harm the stock. First he aligned himself with Trump, which upset many potential Democratic buyers. Now he has turned on the Trump administration," said Tesla shareholder Dennis Dick, chief strategist at Stock Trader Network. With EV sales falling, Musk over the last year has re-oriented Tesla's future around self-driving robotaxis. On an earnings call last year, he said investors "should sell their Tesla stock" if they did not believe the company would solve the technological challenges of driverless vehicles. Wedbush analysts have said the AI and autonomous opportunities could be worth $1 trillion alone in market value for the company. Musk has advocated for one federal approval process for autonomous vehicles to streamline the current maze of different state regulations. Ross Gerber, CEO of Tesla investor Gerber Kawasaki Wealth and Investment Management, said the feud with Trump "creates a negative force against Tesla" that could jeopardize regulations and risk more government investigations. "Every benefit that was perceived he would have got now turns into a negative," Gerber said. Musk, the world's richest man and a key figure in the Department of Government Efficiency's (DOGE) cost-cutting plan for several months, blasted Trump's "big beautiful bill" this week, after he decided to spend less time in the White House and instead focus on his companies. Following Thursday's selloff, his net worth fell by roughly $27 billion to $388 billion, according to Forbes. Trump on Thursday said on his Truth Social platform that the "easiest way to save money in our Budget, billions and billions of dollars, is to terminate Elon's governmental subsidies and contracts." Transportation Secretary Sean Duffy has already moved to exempt autonomous vehicles from some safety requirements, and NHTSA said in April it is "actively engaged in developing a multi-faceted regulatory framework" for autonomous vehicles. Although the federal government has already started to streamline some regulations around autonomous driving, Morningstar analyst Seth Goldstein said regulators might possibly craft rules in a way that would single out Tesla. Most autonomous vehicle companies use sensors such as radar and lidar to detect objects, for example, but Tesla relies solely on cameras. Goldstein said federal regulators might devise rules requiring lidar, which would hurt Tesla. "With President Trump, being on his bad side always creates risk that you're going to get personal retaliation," Goldstein said. He doubted that such an outcome was likely, though, because many other companies have been pushing for new regulations for years. The stock has been on a roller-coaster ever since Musk endorsed Trump in mid-July 2024 in his re-election bid, gaining 169% from that point through mid-December. That was followed by a 54% slide through early April as a "Tesla Takedown" protest intensified. Musk's leadership of DOGE and alignment with the Trump administration had put off some car buyers, with sales slumping in Europe, China and key U.S. markets like California. The House of Representatives version of Trump's budget bill proposes largely ending the popular $7,500 EV subsidy by the end of 2025. Tesla and other automakers have relied on incentives for years to drum up demand, but Trump promised during the transition to end the subsidy. Tesla could face a $1.2 billion hit to its annual profit, along with an additional $2 billion setback to regulatory credit sales due to separate Senate legislation targeting California's EV sales mandates, according to J.P. Morgan. The company is still the most valuable automaker worldwide by a long shot. Through Wednesday, Tesla's market value stood at about $1 trillion, well above Toyota Motor's $290 billion. "There were a lot of people excited about Tesla because the political winds were at his (Musk's) back. And now they've turned into headwinds in a lot of different ways," Steve Sosnick, chief strategist at Interactive Brokers, said. Tesla trades at 150 times profit estimates, a steep premium to other Big Tech stocks such as Nvidia. "I am short Tesla. I don't understand it. I don't understand its valuation. I don't understand its fundamentals. I think it's overhyped," Bob Doll, Crossmark Global Investments chief investment officer, said.

Trump Vs. Musk: President Selling His Tesla -- Is Targeting Robotaxis Next? - Tesla (NASDAQ:TSLA)

A feud between Tesla Inc TSLA CEO Elon Musk and President Donald Trump escalated Thursday with comments made in interviews and across social media. The fight sent shares of Tesla lower Thursday and the stock could go lower with the potential for Trump to harm the electric vehicle sector and the company. What Happened: Musk's opposition to the "Big Beautiful Bill" saw Trump accuse the Tesla CEO of only speaking out in opposition due to the bill hurting EV tax credits and his own company. A series of back-and-forth messages on social media saw some attacks against Tesla and the government and some personal attacks. "This is an unfortunate episode from Elon, who is unhappy with the One Big Beautiful Bill because it does not include the policies he wanted. The President is focused on passing the historic piece of legislation and making our country great again," White House Press Secretary Karoline Leavitt told Benzinga when asked for comment on some tweets made by Musk. Tesla stock posted its biggest one-day market capitalization fall on Thursday, with investors worried about the damage the fight could cause to Musk-related companies. Trump threatened to pull government subsidies related to SpaceX and already planned to remove EV tax credits, which could harm Tesla and the overall electric vehicle sector. Here's a look at some of the areas that could be impacted. Robotaxi Concerns: Given Trump's past opposition to autonomous vehicles, or robotaxis, one area that could be closely watched now is the future of these vehicles. Hours before Musk unveiled the Tesla Cybercab in California on Oct. 10, 2024, Trump spoke at the Detroit Economic Club and took on autonomous vehicles. "Do you like autonomous? Does anybody like an autonomous vehicle? Know what that is? Right? When you see a car driving along? Some people do, I don't know. A little concerning to me, but the autonomous vehicles we're going to stop from operating on American roads," Trump said. Trump's comments came despite his growing friendship with Musk, who had been campaigning for him in the 2024 election. After once threatening to ban autonomous vehicles in America, Trump appeared to have had a change of heart and eased restrictions on self-driving vehicles. The reversal could help Tesla in its push to expand FSD and bring robotaxis to the market. With Tesla set to launch its robotaxi service in Texas next week, all eyes will be on Trump to see if he reverses course again on the issue. Read Also: Tesla The Best Elon Musk Company? 84% Say No -- These 3 Rank Higher Tesla Brand Damage: Tesla has suffered from brand damage in the last year. A series of protests took on the EV company, and some owners traded in their vehicles due to Musk's political push. Previously appealing to fans of clean energy initiatives and Silicon Valley investors, Tesla appeared to change its target demographic with Trump supporters and MAGA (Make America Great Again) fans buying Tesla vehicles to show support for Musk and his backing of the president. With a feud between Trump and Musk now escalated, Trump fans might be the last people who want to buy a Tesla vehicle. A report on Friday from the New York Post said Trump is planning to sell or give away the red Tesla Model S he bought on the White House lawn in a show of public support for Musk and Tesla at the time, as the brand saw several violent attacks against stores and vehicles. While Trump can not drive the vehicle due to presidential rules, he said he would leave it on the White House lot for staff use. Trump selling his Tesla vehicle could be negative for the EV company and show that his support for it has been withdrawn. Other Areas: In addition to the above-mentioned items, Trump's plan to end the $7,500 EV tax credit will hurt Tesla and the sector. Musk has been supportive of ending this incentive and analysts say it could actually help the company and crush Tesla's rivals in the sector. The Tesla CEO and his companies have been under past and current investigations by many government organizations including the SEC and DOJ. While working with the government through the Department of Government Efficiency, Musk replaced the leaders at some of the organizations that investigate and regulate his companies. The rift between Musk and Trump could lead to a return of investigations against the CEO and his companies. Musk and his SpaceX company have received government contracts in the past and those could come under question, as Trump seemed to signal in one social media post. Trump said government subsidies and contracts that help Musk could be terminated to save billions of dollars. Musk indicated that he could end the SpaceX Dragon program, which has brought astronauts to and from the International Space Station. SpaceX's Starlink was also in talks to secure deals with the FAA and is a major player in providing internet in humanitarian efforts and international conflict areas like Ukraine. The battle between Trump and Musk could put into question whether Trump could try to block Musk's efforts. TSLA Price Action: Tesla stock is up 5.8% to $301.09 on Friday versus a 52-week trading range of $167.41 to $488.54. Tesla stock is down 20.7% year-to-date in 2025, with shares falling over 12% in the last five days. Read Next: Tesla Owners Who Don't Like Musk Are Letting Bumper Stickers Do The Talking Image created using artificial intelligence via Midjourney. TSLATesla Inc$300.715.62%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum92.07Growth91.86Quality86.74Value9.28Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

Musk opens his empire to multi-front risk by feuding with Trump

By Ed Ludlow, Loren Grush and Joshua Green, Bloomberg News The Tribune Content Agency What began as Elon Musk's embrace of right-wing populism has become a defining - and potentially harmful - chapter in his business career. By endorsing Donald Trump's MAGA movement and far-right parties in Europe, Musk alienated a big portion of his original customer base, eroding Tesla's brand, sales and market share around the globe. Then came this week's rupture: a personal and public breakup with Trump that prompted threats of retaliation from a man with control over the world's most powerful government. By simultaneously burning bridges with both his customers and now the political movement he funded and amplified for months, Musk now faces a rare convergence of threats: collapsing brand loyalty, shaky revenues, and mounting legal and regulatory risk. Tesla Inc.'s sales are already stumbling under the weight of partisan baggage. SpaceX, long seen as a strategic national asset, is facing new scrutiny as political winds shift. And the green shoots at X - Musk's $44 billion "free speech" experiment- that were fueled by Musk's proximity to the White House and the ad dollars that followed, may soon disappear. "Elon isn't functioning to the benefit of his shareholders," said Ross Gerber, the chief executive officer of Tesla shareholder Gerber Kawasaki, which has been reducing its Tesla holdings over the last few years. Speaking on Bloomberg Television on Thursday while the meltdown was still going on, Gerber said Musk's behavior is leading to the "dismantling of the Musk empire in real time." With enemies on both flanks, Musk finds himself at the center of a storm fueled by consumer revolt and political hostility. "Nobody on the right is gonna buy a Tesla, nobody on the left is gonna buy a Tesla. Elon is a man without a country," said Steve Bannon, an outside adviser to Trump who has long been critical of Musk, in an interview. Bannon says he is "in continual conversations at the most senior levels" of the Trump administration to push them to revoke Musk's security clearance and use the Defense Production Act to seize SpaceX and Starlink on grounds they're vital to US national security. Even if Trump doesn't take such extreme measures, there is no shortage of retaliatory options for the White House. The president could try to wield the power of agencies like the US Securities and Exchange Commission, the National Highway Traffic Safety Administration and the Federal Aviation Administration to inflict real harm - or even just incessant regulatory morass - onto all of Musk's businesses and the source of his wealth. In just one day, the Musk-Trump spat shaved $34 billion from his personal net worth, the second-largest loss ever in the history of the Bloomberg Billionaires Index of the 500 wealthiest people on the planet. The only bigger wealth hit: his own wipeout in November 2021. Tesla lost $153 billion of market value on Thursday, with shares reversing course on Friday after Musk began to simmer down. Musk has faced deep stretches of pain before. There are flanks of skeptics who have, over the years, called for his impending demise only to be proven wrong by the world's richest man and his cult following of fans and funders willing to throw ever-growing sums of money at his ambitions. Most famously, Tesla flirted with bankruptcy only to reverse course and become the biggest electric vehicle seller in the world. Musk's $44 billion purchase of X was widely panned as the company's debt languished on banks' books, only to see those fortunes reversed after Trump's election. "Musk has a habit of teetering on the edge of destruction and pulling himself back just in the nick of time," said Nancy Tengler, whose firm holds 3.5% of its growth portfolio in Tesla stock, in a Friday interview on Bloomberg Television. Tengler, CEO and chief investment officer of Laffer Tengler Investments, said her firm has been adding Tesla shares in recent months but now has a "full position." "He needs to dial down the rhetoric and the drama and get back to the business," she says, as investors own Tesla stock for growth, not for "the histrionics." To pull off a rebound this time around, Musk is going to have to convince people to start buying his electric vehicles at a faster clip and reverse the painful sales slide in the US, Europe and around the world. He's also going to have to attract riders to his new robotaxi service in Austin as the company makes a gigantic bet on artificial intelligence, robotics and self-driving cars. Musk has lobbied lawmakers to help clear a path for driverless vehicles, something Trump initially endorsed. It's now unclear if the Trump-Musk fallout complicates the regulatory environment for autonomous vehicles and potentially slows the path forward for Tesla's robotaxi network. "The disagreement will not help Tesla demand but could potentially (temporarily) alienate multiple sides of the political spectrum," said Morgan Stanley analyst Adam Jonas in a research note entitled "Well That Escalated Quickly..." Jonas said emotions are "running high" and that he's sticking to his long-term $410 price target on Tesla's share price but is bracing for near-term volatility and is "prepared for the stock to give up more." Other tests in the coming weeks may include a $5 billion debt offering of the billionaire's AI company, xAI Corp., as well as funding rounds for xAI and SpaceX. Musk recently closed a $650 million late-stage raise for his neurotechonlogy company Neuralink from big investors including Sequoia Capital, ARK Investment Management and Founders Fund. From a legal and regulatory perspective, there's even more at stake for Musk if the Trump administration turns on the billionaire and claws back contracts like the president threatened on Thursday. SpaceX, one of the world's most valuable startups with a market value of $350 billion, has received more than $22 billion in unclassified contracts from the Defense Department and NASA since 2000, according to data from Bloomberg Government. It launches critical national security satellites for the Pentagon and the US is depending on the Musk-led company to develop a spacecraft to put American astronauts on the moon in as little as two years. Musk's vow to decommission its all-important Dragon spacecraft, which ferries cargo and people to the International Space Station for the US, sent shock waves throughout the industry. Following through with the threat, which Musk later walked back, would sever a vital part of the US space program. "It is untenable to have a CEO of a prime defense and aerospace contractor threaten to shut down services the government has contracted with them to perform," said Lori Garver, a former NASA deputy administrator under former President Barack Obama. Garver says NASA needs SpaceX, but that SpaceX's business model also depends, in part, on the US government. "Elon has already walked back decommissioning Dragon, because they do require now, as a big part of their business plan, government contracts. But they provide a service for those contracts. So it's a symbiotic relationship," Garver said. On a more day-to-day basis, government agencies could try to inflict pain on Musk's businesses by delaying everything from space launches to satellite service to robotaxi expansion. Investigations into publicly traded Tesla or the finances of his companies could include the SEC, as well as antitrust probes and Federal Trade Commission interest around social media moderation, data use or AI. So far, Musk and Trump may be trying to at least press pause on the public spectacle. White House officials say Trump plans to focus his attention on inflation and the economy rather than speak to Musk, and insinuated without evidence that the billionaire was agitating for a call with the president. (In a pair of posts on his social media platform Friday morning, Trump intensified his push for Federal Reserve Chair Jerome Powell to lower rates.) As for pulling Musk's government contracts, Trump hasn't yet pursued any steps to follow through with his threats, one of these people said. He is, however, thinking of getting rid of his Tesla. (With assistance from Josh Wingrove, Akayla Gardner, Denise Lu, Mathieu Benhamou and Paul Murphy.)

Tesla Loses Billions in Value as Musk-Trump Feud Heats Up Over EV Subsidies

Musk turns on Trump, triggering steep Tesla declines President Trump has threatened to end government subsidies and contracts to Elon Musk's companies, with Tesla facing billions of dollars in annual losses without various state and federal programs. Musk escalated the feud with a series of posts on X, formerly Twitter, attacking the president, erasing $150 billion in Tesla's market value on Thursday before a Friday rebound. After the market's close on Friday, Tesla's market cap stood at about $950 billion, down from roughly $1.1 trillion at the week's start. Musk's specific criticisms of Trump's bill include the entrepreneur saying: "There is no change to tax incentives for oil & gas, just EV/solar," according to The Hill. The Tesla CEO also said on X: "Abruptly discontinuing the energy tax incentives would jeopardize America's energy autonomy and the dependability of our power grid." On Thursday, President Trump said on his Truth Social platform that the "easiest way to save money in our budget, billions and billions of dollars, is to terminate Elon's governmental subsidies and contracts," Reuters reports. The president also posted on Truth Social: "Elon was 'wearing thin,' I asked him to leave, I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!" How Trump's and Congress's initiatives impact Tesla The House of Representatives version of Trump's bill, passed in late May, proposes to largely end the federal $7,500 tax credit for new electric vehicle (EV) purchases by the end of 2025. If passed by the Senate, eliminating the federal EV subsidy could erase $1.2 billion in Tesla's annual profits, according to Reuters. Separate Senate legislation that removes California's EV sales mandates could lower Tesla's yearly sales by another $2 billion. Tesla earned almost $2.8 billion last year by selling regulatory credits to other automakers, helping competitors meet government-established car emissions rules, many of which are in California. Since Tesla only makes all-electric vehicles, it earns a surplus of regulatory credits that it can sell to other automakers. Competitors who don't manufacture enough zero-emission vehicles face steep fines if they don't purchase regulatory credits from Tesla. Republicans in Congress are working to lower some of the federal waivers California needs for stricter emissions standards than the federal government, and if rolled back, Tesla's regulatory credit profits would take a significant hit. Tesla plans to launch its driverless robotaxi rideshare service in Austin, Texas, this month, subject to government oversight. Still, analysts don't believe Musk's feud with Trump will impact the autonomous Tesla fleet's debut. Gene Munster, Tesla investor and managing partner at Deepwater Asset Management, said: "In my view, the White House has little to gain in standing in front of autonomy, given autonomy is central to physical AI, and for the US to be a leader globally in AI, it also needs to be a leader in physical AI," according to Business Insider. Autoblog contacted Tesla for comment but didn't receive a response. Final thoughts Elon Musk spent over $250 million to help re-elect Donald Trump, with Tesla's stock increasing after the President's victory. However, Musk's controversial time as a special government employee, most notably with the Department of Government Efficiency (DOGE), triggered severe stock declines at Tesla, ultimately causing the entrepreneur to step away from politics and focus more on his company. Musk's decision to go on the offensive against Trump could further erase any benefits he and Tesla initially gained through their partnership, as reflected in this past week's stock market. Gene Munster estimated in a Friday report that eliminating EV tax credits could reduce Tesla's 2025 deliveries by 15%.

Trump-Musk row slams Tesla shares, $150 billion in market value wiped out

(Reuters) -Tesla shares went into free-fall on Thursday as President Donald Trump publicly feuded with the electric vehicle maker's billionaire CEO Elon Musk, his self-proclaimed "First Buddy." Investors watched the unfolding drama with growing worry about what the fracas could mean for Musk's business empire. The carmaker's shares ended the day down 14%, wiping off $150 billion in market value on a day absent other news about the company. Traders dumped Tesla in heavy trading after Musk quickly responded to Trump's criticism with social media posts that stepped up criticism of the president's tax bill. Trump fired back further, alleging Musk was upset because the bill takes away tax benefits for electric vehicle purchases. Openly feuding with Trump could pose multiple hurdles for Tesla and the rest of Musk's sprawling business empire. The U.S. Transportation Department regulates vehicle design standards and would have a big say in whether Tesla can mass-produce robotaxis without pedals and steering wheels. The agency is also investigating Tesla's driver-assistance software, known as "Full Self-Driving," following a fatal crash. "Elon's politics continue to harm the stock. First he aligned himself with Trump, which upset many potential Democratic buyers. Now he has turned on the Trump administration," said Tesla shareholder Dennis Dick, chief strategist at Stock Trader Network. With EV sales falling, Musk over the last year has re-oriented Tesla's future around self-driving robotaxis. On an earnings call last year, he said investors "should sell their Tesla stock" if they did not believe the company would solve the technological challenges of driverless vehicles. Wedbush analysts have said the AI and autonomous opportunities could be worth $1 trillion alone in market value for the company. Musk has advocated for one federal approval process for autonomous vehicles to streamline the current maze of different state regulations. Ross Gerber, CEO of Tesla investor Gerber Kawasaki Wealth and Investment Management, said the feud with Trump "creates a negative force against Tesla" that could jeopardize regulations and risk more government investigations. "Every benefit that was perceived he would have got now turns into a negative," Gerber said. Musk, the world's richest man and a key figure in the Department of Government Efficiency's (DOGE) cost-cutting plan for several months, blasted Trump's "big beautiful bill" this week, after he decided to spend less time in the White House and instead focus on his companies. Following Thursday's selloff, his net worth fell by roughly $27 billion to $388 billion, according to Forbes. Trump on Thursday said on his Truth Social platform that the "easiest way to save money in our Budget, billions and billions of dollars, is to terminate Elon's governmental subsidies and contracts." Transportation Secretary Sean Duffy has already moved to exempt autonomous vehicles from some safety requirements, and NHTSA said in April it is "actively engaged in developing a multi-faceted regulatory framework" for autonomous vehicles. Although the federal government has already started to streamline some regulations around autonomous driving, Morningstar analyst Seth Goldstein said regulators might possibly craft rules in a way that would single out Tesla. Most autonomous vehicle companies use sensors such as radar and lidar to detect objects, for example, but Tesla relies solely on cameras. Goldstein said federal regulators might devise rules requiring lidar, which would hurt Tesla. "With President Trump, being on his bad side always creates risk that you're going to get personal retaliation," Goldstein said. He doubted that such an outcome was likely, though, because many other companies have been pushing for new regulations for years. The stock has been on a roller-coaster ever since Musk endorsed Trump in mid-July 2024 in his re-election bid, gaining 169% from that point through mid-December. That was followed by a 54% slide through early April as a "Tesla Takedown" protest intensified. Musk's leadership of DOGE and alignment with the Trump administration had put off some car buyers, with sales slumping in Europe, China and key U.S. markets like California. The House of Representatives version of Trump's budget bill proposes largely ending the popular $7,500 EV subsidy by the end of 2025. Tesla and other automakers have relied on incentives for years to drum up demand, but Trump promised during the transition to end the subsidy. Tesla could face a $1.2 billion hit to its annual profit, along with an additional $2 billion setback to regulatory credit sales due to separate Senate legislation targeting California's EV sales mandates, according to J.P. Morgan. The company is still the most valuable automaker worldwide by a long shot. Through Wednesday, Tesla's market value stood at about $1 trillion, well above Toyota Motor's $290 billion. "There were a lot of people excited about Tesla because the political winds were at his (Musk's) back. And now they've turned into headwinds in a lot of different ways," Steve Sosnick, chief strategist at Interactive Brokers, said. Tesla trades at 150 times profit estimates, a steep premium to other Big Tech stocks such as Nvidia. "I am short Tesla. I don't understand it. I don't understand its valuation. I don't understand its fundamentals. I think it's overhyped," Bob Doll, Crossmark Global Investments chief investment officer, said. (Reporting by Chris Kirkham and Abhirup Roy, Akash Sriram and Kanchana Chakravarty; additional reporting by Saqib Iqbal Ahmed and Gertrude Chavez-Dreyfuss in New York; Editing by Michael Colias, David Gaffen, Anil D'Silva, Arun Koyyur and David Gregorio) By Akash Sriram, Kanchana Chakravarty, Chris Kirkham and Abhirup Roy