By M10News Business Desk
© M10News 2025 – All Rights Reserved
New York – A renewed war of words between Elon Musk and President Donald Trump is rattling financial markets, with Tesla’s share price dropping over 5% following Musk’s latest attack on a controversial federal spending bill.
In recent years, the automotive industry has undergone significant transformations, particularly with the rise of electric vehicles (EVs) and the increasing prominence of companies like Tesla. As consumers become more environmentally conscious, the demand for electric cars has surged.
Tesla, with its innovative approach to manufacturing and marketing, has positioned itself as a frontrunner in this sector. This has led to discussions not only about the financial implications of such leadership but also about the broader impact on global energy consumption and sustainability efforts.
The tech billionaire lashed out at the “Big, Beautiful Bill,” recently passed by the U.S. Senate, branding it “insane” and accusing Trump of abandoning fiscal responsibility. The comment escalated an already tense feud between the two former allies.
Moreover, the political landscape surrounding EVs is becoming more complex. Policies promoting green energy and EV adoption often hinge on government support and incentives.
The ongoing feud between Musk and Trump illustrates the precarious nature of these relationships. If such incentives were to diminish, companies like Tesla might find themselves navigating a more challenging market, which is why investors often react immediately during political disputes.
President Trump fired back, saying he would “take a look” at Musk’s citizenship status and warned that the Department of Government Efficiency (DOGE)—a defunct initiative Musk once advised—could be reactivated to scrutinise the Tesla and SpaceX CEO’s government contracts.
“We might have to cut his subsidies,” Trump said, referencing billions in federal support that benefit Musk’s companies, including SpaceX’s satellite and rocket programs.
Investors React to Political Turmoil
The dispute appears to have spooked Wall Street. Tesla’s stock fell more than 5% by Tuesday afternoon amid investor unease over Musk’s increasingly political profile and the potential threat to lucrative government incentives.
As this feud unfolds, investors are watching closely how it may influence Tesla’s future. The stock market has been particularly volatile, reflecting broader economic concerns including inflation, supply chain disruptions, and changes in governmental policy.
For instance, as the Biden administration seeks to push forward with its climate agenda, any tensions with key industry players could create uncertainties in the market, leading to fluctuations in stock prices.
Market analysts say Musk’s deepening political entanglements—especially with a sitting president—are raising red flags for shareholders already jittery over previous volatility and a wave of climate protests at Tesla showrooms earlier this year.
“Musk’s outspoken politics are once again bleeding into investor sentiment,” said Dana Clifton, senior tech analyst at GlobalView Markets. “The risk isn’t just regulatory—it’s reputational. And that has real financial consequences.”
Additionally, the backlash from consumers regarding Musk’s political involvement could also affect brand loyalty. Consumers today are looking for brands that align with their values. Companies that become embroiled in political controversies risk alienating segments of their customer base. This is particularly relevant for Tesla, which has cultivated a loyal following among environmentally conscious consumers.
DOGE Fallout and Shareholder Anxiety
Musk previously served as a senior advisor in Trump’s now-defunct Department of Government Efficiency, a role he left during an earlier breakdown in relations. The revival of the feud has reignited scrutiny over Musk’s role in politics and his dependence on federal funds.
In light of this feud, it’s also worth considering how public perception can shape the trajectory of innovative companies. Musk’s influence extends beyond just his companies; he has become a cultural icon. His social media presence and public persona play a significant role in Tesla’s brand image. Therefore, the implications of his actions and words carry weight not only for his financial empire but for the broader EV movement as well.
While Musk remains a leading figure in space and electric vehicle innovation, his feud with the White House has sparked fears of targeted retaliation, particularly as Trump’s administration signals a potential rollback of EV subsidies.
Tesla, SpaceX, and Musk have not responded to Trump’s remarks. However, Musk has continued posting cryptic memes and defiant messages to his 220 million followers on X, hinting at further confrontations.
Looking ahead, the sustainability of Tesla’s growth will depend on navigating political waters effectively. Should Musk wish to maintain his position as a key player in the EV market, he may need to reconcile his political rhetoric with the business interests of Tesla. This balance will be crucial as the industry faces increasing scrutiny regarding its environmental impact and the integrity of its leaders.
Editing by M10News Finance Team | Contact: business@m10news.com
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