Tesla stock drops as Trump and Musk's public feud escalates
Share and Follow


By the end of the trading day, $150 billion of Tesla’s value had been erased.

WASHINGTON — Investors bought hundreds of billions of dollars of Tesla stock after Donald Trump was elected on a bet that politics were more important than profits.

In three hours Thursday, they learned yet again how dangerous that gamble could be.

Shares of Elon Musk’s electric vehicle maker plunged more than 14% in a stunning wipeout as investors dumped holdings amid a bitter war of words between the president and the world’s richest man. By the end of the trading day, $150 billion of Tesla’s value had been erased, more than what it would take to buy all the shares of Starbucks and hundreds of other big publicly traded U.S. companies.

The disagreement started over the president’s budget bill, then quickly turned nasty. After Musk said that Trump wouldn’t haven’t gotten elected without his help, Trump implied that he may turn the federal government against his companies, including Tesla and SpaceX.

“The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts,” Trump wrote on his social messaging service Truth Social. “I was always surprised that Biden didn’t do it!”

The drop on Thursday partially reversed a big runup in the eight weeks since Musk confirmed that Tesla would be testing an autonomous, driverless “robotaxi” service in Austin, Texas, this month.

Investors fear Trump might not be in such a rush to usher in a future of self-driving cars in the U.S., and that could slam Tesla. So much of its real business selling electric cars is struggling now and so it needs the promise of a new age of driverless cars to be realized— and fast.

“The whole goal of robotaxis is to have them in 20 or 25 cities next year,” said Wedbush Securities analyst Dan Ives, one of Tesla’s biggest fans, but now worried. “If you start to heighten the regulatory environment, that could delay that path.”

He added, “There is a fear that Trump is not going to play Mr. Nice Guy.”

Trump’s threat to cut government contracts seems targeted more to another of Musk’s businesses, SpaceX, than his car company. The privately held rocket company has received billions of dollars for sending astronauts and cargo to the International Space Station, providing launches and doing other work for NASA. The company is currently racing to develop a mega rocket for the space agency to send astronauts to moon next year.

A subsidiary of SpaceX, the satellite internet company Starlink, appears to also have benefited from Musk’s once-close relationship with the president.

On a trip with Trump to the Middle East last month, Musk announced that Saudi Arabia had approved Starlink for aviation and maritime use. Though its not clear how much politics has played a role, a string of other recent deals in Bangladesh, Pakistan, India and elsewhere has come as Trump has threatened tariffs and sent diplomats scrambling to please the president.

One measure of SpaceX’s success: A private financing round followed by a private sale of shares in recent months reportedly valued it at an $350 billion, up from an estimated $210 billion a year ago.

Now all that is possibly in danger. Tesla shares got even a bigger lift from Musk’s close relationship with Trump, initially at least.

After the presidential election in November, investors rushed into the stock, adding more than $450 billion to its value in a few weeks. The belief was that the company would see big riches as Trump eased regulatory oversight of Tesla. They also were betting that the new administration would embrace Musk’s plans for millions of cars on U.S. roads without drivers behind the wheel.

After hitting an all-time high on Dec. 17, the shares retreated as Musk’s time as head of a government cost-cutting group led to boycotts and a hit to Tesla’s reputation. They’ve recently popped higher again after Musk vowed to focus more on Tesla and its upcoming driverless taxi launch.

Now investors aren’t so sure, a worry that has translated into big paper losses in Tesla stock held by Musk personally — down $20 billion for the day.

Copyright 2025 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.     

Share and Follow
You May Also Like
Cops reveal new details on Sophia Hutchins' fatal ATV crash

Police share additional information about the ATV accident that resulted in the death of Sophia Hutchins

Heartbreaking details about Caitlyn Jenner’s friend and longtime manager Sophia Hutchins’ shocking…
Search for 27 missing girls plows forward after flash flood kills at least 51 people in Texas

Efforts to find 27 missing girls continue following flash flood that claims minimum of 51 lives in Texas

KERRVILLE, Texas (AP) — The grueling, desperate search for 27 missing girls…
A look at some of the deadliest floods in the US in the last 25 years

Examining the most devastating floods in the United States over the past 25 years

Flooding has caused an average of more than 125 deaths per year…
Rep. Greene pushes ‘weather modification’ ban in legislation

Rep. Greene advocates for a ban on ‘weather modification’ in proposed law

Rep. Marjorie Taylor Greene (R-Ga.) said Saturday she plans to introduce a…
Red state now offers preferred parking for pregnant women

Red state now offers preferred parking for pregnant women

NEWYou can now listen to Fox News articles! Florida is days into…
Tropical Storm Chantal strengthens slightly as it nears landfall in South Carolina

Tropical Storm Chantal gets stronger as it approaches South Carolina for landfall

MIAMI (AP) — Tropical Storm Chantal grew in strength as it approached…
Amount you need for a 'minimum quality of life' in America revealed

Revealed: the required amount for a basic standard of living in the United States

A family-of-four needs to earn over $100,000 a year just to maintain…
A-lister mansion that takes up a ZIPCODE... with mysterious symbols

Luxurious Mansion Covers Entire Area with Secret Symbols

Plenty of Hollywood stars own lavish estates, but only one – that…