Tesla Expert Warns Musk vs Trump Could SINK Stock Prices
On Thursday, shares of Tesla (TSLA) experienced a significant 9% drop. This decline occurred as Tesla CEO Elon Musk and President Donald Trump engaged in public conflict over a spending bill moving through Congress.
President Trump stated from the Oval Office that Musk was upset because electric vehicle (EV) credits were not included in the bill. Trump also commented on his relationship with Musk, saying, "Elon and I had a great relationship. I don't know if we will anymore," adding that he was surprised.
Musk responded on X, claiming that "Without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate". Musk has called the bill a "disgusting abomination" and has threatened lawmakers who vote for it with primary elections. This marks a significant shift in his comments regarding the administration.
The share decline follows a 22% rally for the EV maker in May. The recent fall also coincides with Musk wrapping up his time as head of Trump's so-called Department of Government Efficiency (DOGE), and his term as a special government employee ending Friday. Shares are down 12% this week and over 20% this year.
Musk reportedly attempted to persuade Trump and other Republican administration members to change parts of the bill that would reduce EV and residential solar tax credits, which generate profits for Tesla. The measure in question would also impose a new annual $250 fee on EV drivers. According to Walter Isaacson, author of a Musk biography, Musk is "seriously upset" about these matters and tends to go "all in".
Sources also indicate Musk was annoyed with members of the Trump administration who worked against the NASA nomination of Jared Isaacman, an ally who led private spaceflights through Musk's SpaceX. Isaacman's nomination was pulled over the weekend.
Beyond the political issues, Tesla is also facing more fundamental problems, including plummeting sales of its electric vehicles in major European markets and a declining brand reputation in the West. The company is also under pressure to launch a long-delayed driverless ride-hailing service in Austin, Texas, this month.
Watch the video to learn more about the factors driving Tesla's stock performance and the spat between two prominent figures!
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