Tesla (NASDAQ:TSLA) stock took a steep 14% dive Thursday, wiping $34 billion off Elon Musk’s net worth after an unusually public brawl with President Donald Trump. It started with Musk calling for Trump’s impeachment and hinting he’s in the unreleased Epstein files. Trump fired back fast, threatening to cancel billions in federal contracts and EV subsidiesfinancial pillars for both Tesla and SpaceX, which have together received $22.5 billion from the U.S. government since 2000.
At the heart of the fight? A new GOP tax bill that would gut EV credits seven years ahead of schedulecosting Tesla roughly $1.2 billion in profit, per JPMorgan. Trump accused Musk of turning hostile only after realizing his EV mandate would be scrapped. Musk hit back, denying any prior knowledge of the bill and slamming the mountain of disgusting pork packed inside. Meanwhile, allies like Bill Ackman (Trades, Portfolio) urged both men to step back. Musk responded, You’re not wrong. Still, Trump’s camp doubled down, even suggesting Musk’s citizenship be revieweda move Steve Bannon says is overdue.
Despite the fireworks, there’s movement toward a ceasefire. Musk reversed his earlier threat to pull SpaceX’s Dragon spacecraft from NASA missions and hinted at cooling tensions. A Friday call between Musk and the White House is reportedly in the works. But the damage may be done: a once-strategic alliance is now unraveling in real timeon X, in headlines, and across markets. And with Musk floating a third political party and slamming Trump’s EV cuts, Tesla shareholders may be facing not just policy risk, but political risk.
This article first appeared on GuruFocus.
