Tesla’s stock sinks more than 14% as rift between Musk and Trump escalates

Elon Musk and Donald Trump in the Oval Office late last month.

Tesla Inc.’s stock was on the verge of a technical breakthrough last week, with investors brimming with hope that a return of Chief Executive Elon Musk to headquarters and his promise that he’d stay for years to come would benefit the shares.

All that came crashing down on Thursday as the relationship between Musk and President Donald Trump soured in a very public fashion, with Musk saying on X, the social-media platform he owns, that Trump would have lost the election without his support and had more choice words for the president.

Musk went so far as to post a laconic yet laden-with-meaning “Kill Bill,” referring to the Republican budget bill now being considered in the Senate.

A recent jab included a reference to the “Epstein files,” the trove of government documents related to convicted sex offender and disgraced financier Jeffrey Epstein:

Musk officially said goodbye to the entity known as the Department of Government Efficiency, or “DOGE,” a week ago. Since then, Tesla has lost about $199 billion in market capitalization. Thursday’s losses prompted Tesla’s market value to slide below $1 trillion for the first time since May 9.

The stock got a boost immediately after the news Musk would leave Washington, but since then there have been more days in the red than in the black. Then came the public war of words between Trump and Musk over Trump’s “big, beautiful” tax and spending bill.

Musk is “genuinely upset” about projected deficits and other aspects of the bill and “feels slighted after his massive political donations and efforts to reduce the deficit through DOGE,” CFRA analyst Garrett Nelson said in an interview.

Thursday’s selloff is reflecting a combination of factors, he said. There was an “unjustified” run-up following Tesla’s first-quarter earnings, along with ongoing news of market-share losses in key overseas markets “and a realization that next week’s Austin [Texas] robotaxi launch could disappoint,” he said.

The stock ended at its lowest price since May 7, and suffered its largest one-day percentage decrease since March 10, when it fell 15%. It has been down for four of the past five trading sessions. It was the second worst performer in the S&P 500 index Thursday, and the most active on the index.

Tesla is about to launch a pilot robotaxi program in Austin next week, with Musk promising a rapid expansion to more U.S. cities this year. That could be a near-term catalyst for Tesla shares, but it also opens the company up for more risk if the launch stumbles.

Musk lent the power of his public persona to elect Trump, and also put his money where his mouth was, spending some $291 million to help elect Trump and in support of other Republican candidates and causes.

Tesla shares hit a record high in December on hopes that the new Trump administration would benefit the electric-vehicle maker, which has bigger designs on nascent autonomous-vehicle technology and humanoid robots. Musk has spoken out against EV tax credits, which are slated to be phased out in the version of the bill before the Senate, even as Tesla still relies on them to boost its bottom line.

Tesla’s stock is now down 41% from that record high of $479.86 on Dec. 17. So far this year, it is down about 30%, contrasting with gains of about 1% for the S&P 500 index.