Tesla’s shares dropped by about 14.2% on Thursday at market close, wiping roughly $152bn off the value of the company as a feud between Elon Musk and Donald Trump erupted into public view. The former political allies traded threats and insults through posts on their respective social media platforms throughout the afternoon as the company’s price fell.
Trump suggested on Truth Social that he could cut Musk’s government subsidies and contracts, of which both Tesla and SpaceX have been immense beneficiaries. Musk meanwhile threatened to decommission the SpaceX spacecraft that Nasa relies on for transport missions, called for Trump’s impeachment, derided the president’s signature tariffs and accused him of being affiliated with the notorious sex offender Jeffrey Epstein. Musk said late on Thursday evening his company would not decommission its spacecraft.
The decline in Tesla’s share price on Thursday knocked about $8.73bn off Musk’s total net worth, according to the Bloomberg Billionaires Index. The reported $152bn drop also decreased the value of the company to roughly $900bn.
Tesla has struggled throughout the year amid declining sales and buyers around the world rejecting the automaker due to Musk’s association with far-right politics. Stock traders who had shorted Tesla shares made billions amid the spat, per the Wall Street Journal.
The blow-up is an unexpected and dramatic escalation of a growing rift between two of the world’s most powerful men. Musk had donated about $275m to Trump’s 2024 presidential campaign and served as the leader of the cost-cutting “department of government efficiency” (Doge) for months at the president’s beck and call. It also puts increased investor scrutiny on how the clash could affect Musk’s business empire, with his companies such as Tesla facing potential retribution in the form of canceled government deals or increased regulatory oversight.
The rift began after Musk recently opposed the administration’s new tax bill that eliminates electric vehicle tax credits and would add an expected $2.3tn to the deficit, in effect nullifying the limited “savings” Doge claimed to find. Musk was also reportedly upset about being increasingly iced out of the Trump administration and having the nomination of his preferred candidate to lead Nasa pulled.
Musk and Trump’s feud also comes at a particularly sensitive time for Tesla as it seeks to build a self-driving robotaxi, set to debut in Austin next week. Musk has hinged the company’s future on the product, but it will depend on approval from government regulators to ever become commercially viable.
Meanwhile, shares in the US president’s Truth Social platform parent company, Trump Media & Technology Group, had fallen by 8% at close of trading on Thursday. And the meme cryptocurrency $Trump, backed by Trump, sank 12%.
Eyes were on the markets early on Friday to see if the stocks would bounce back on the prospect of a truce between Trump and Musk.
Joanna Walters contributed reporting
