Tesla’s stock fell 14% on Thursday, wiping out an estimated $150 billion in market value as the public became aware of a high-profile feud between CEO Elon Musk and US President Donald Trump, according to the BBC.
The sharp decline came amid investor concerns over the implications of the rapidly deteriorating relationship between Musk and the White House.
The dispute, which began over a Trump-backed spending bill, quickly escalated into personal attacks exchanged via social media.
Trump retaliated by threatening to sever government contracts with Musk’s businesses, including SpaceX, which currently holds federal agreements worth tens of billions of dollars.
Musk responded defiantly, posting, “Go ahead, make my day.”
Market analysts were rattled by the confrontation. Dan Ives of Wedbush Securities described the situation as “jaw-dropping” and noted growing investor anxiety over potential regulatory fallout.
“This must start to be calmed down,” Ives wrote, warning the clash could undermine Tesla’s hopes for a friendlier regulatory climate under Trump.
Musk’s relationship with the administration had been a key driver of Tesla’s stock rally last year.
The entrepreneur took on a formal role in the government as head of the Department of Government Efficiency and was seen as a close Trump ally. However, that alliance has since become politically contentious and commercially damaging.
Criticism has mounted over Musk’s involvement in controversial government spending cuts, particularly in Europe, where backlash has reportedly impacted Tesla’s sales.
Investor confidence was further shaken by concerns that Musk was distracted by political ambitions and not fully focused on Tesla’s core business.
Last month, the company was forced to deny rumours that it was seeking a new chief executive, after Musk pledged to scale back his government role. His resignation from the administration at the end of May had briefly lifted the stock.
Thursday’s fallout follows Musk’s vocal opposition to the latest Trump spending bill and criticism of new tariffs, which he claimed would trigger a recession later this year.
Trump, in turn, accused Musk of being upset over the removal of electric vehicle tax credits, a key incentive for Tesla buyers and rescinded the nomination of Musk ally Jared Isaacman to lead NASA.
The feud marked a dramatic turn in what was once a high-profile partnership. Tesla’s stock closed at its lowest point since early May, undoing recent gains made in the wake of Musk’s promised return to company leadership.
