June 6, 2025
Tesla Inc. experienced a significant stock market downturn, with shares plummeting over 14% and wiping out approximately $150 billion in market capitalization. This sharp decline follows an escalating public dispute between Tesla CEO Elon Musk and U.S. President Donald Trump, raising investor concerns about potential political and regulatory repercussions.
The Genesis of the Musk-Trump Feud
The conflict between Musk and Trump intensified after Musk publicly criticized the President’s aggressive tariff policies. Also warning that they could push the U.S. economy into a recession by the second half of 2025. This marked a significant departure from their previously cooperative relationship. In response, Trump threatened to terminate government contracts and subsidies for Musk’s companies, including Tesla and SpaceX, stating on his social media platform.
“The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it!”
Market Reaction and Tesla Investor Sentiment
The public spat has rattled investors, leading to a massive sell-off of Tesla shares. The company’s stock price crash partially reversed gains made in the weeks following Musk’s announcement of Tesla’s plans to launch an autonomous, driverless “robotaxi” service in Austin, Texas. Investor confidence appears shaken, resulting in substantial paper losses for Musk’s personal Tesla shareholding, dropping $20 billion in a single day.
Broader Implications
Beyond the immediate financial impact, the Musk-Trump feud has broader implications for Tesla’s future. The potential loss of government support and increased regulatory scrutiny could hinder Tesla’s growth prospects, particularly in emerging sectors like autonomous vehicles. Additionally, the dispute has sparked discussions about the influence of political dynamics on corporate operations and investor confidence.
Also Read : Trump and Musk Collaborate to Dismantle USAID, Prompting Global Debate
Conclusion
The escalating conflict between Elon Musk and President Donald Trump has not only led to a significant financial setback for Tesla but also introduced new uncertainties regarding the company’s future operations and growth. As the situation unfolds, stakeholders will be closely monitoring developments to assess the long-term implications for Tesla and the broader electric vehicle industry.
For further details, refer to the original article on Times of India: Tesla stock price crash wipes out $150 billion! Investors dump Elon Musk’s company as clash with Donald Trump escalates; fear US President won’t be a ‘nice guy’.
