Tesla Inc. (NASDAQ: TSLA) experienced a significant stock decline, shedding over $150 billion in market capitalization within a single trading session. This downturn coincides with an escalating public feud between Tesla CEO Elon Musk and US President Donald Trump, marked by mutual accusations and political fallout.
The discord between Musk and Trump intensified following Musk’s public criticism of the administration’s “One Big Beautiful Bill,” a comprehensive tax and spending proposal. Musk labeled the bill a “disgusting abomination,” expressing concerns over its fiscal implications. In retaliation, President Trump threatened to revoke federal contracts and subsidies for Musk’s enterprises, including Tesla and SpaceX.
The situation further deteriorated when Musk alleged that President Trump’s name appears in the still-sealed Epstein files, suggesting this as the reason for their non-disclosure. These claims have reignited public interest in the Epstein case and prompted calls for transparency from various political figures, according to Al-Jazeera.
The feud’s impact on Tesla’s stock was immediate and severe. On June 5, 2025, TSLA shares plummeted by 14%, closing at $284.70, marking the largest single-day decline in the company’s history. This drop erased approximately $150 billion from Tesla’s market value, raising concerns among investors about the company’s future prospects amid political tensions, according to The Guardian.
Analysts attribute the sell-off to fears of potential regulatory hurdles and the loss of government support for Tesla’s initiatives, particularly in the electric vehicle and space exploration sectors. The uncertainty surrounding federal contracts and subsidies has led to increased volatility in Tesla’s stock performance.
The Musk-Trump fallout has elicited varied responses from political and business communities. Some Republican figures have expressed disappointment over the public spat, emphasizing the need for unity within the party. Conversely, certain business leaders have shown support for Musk’s stance, highlighting concerns over fiscal responsibility and transparency.
The allegations regarding the Epstein files have also intensified scrutiny on the administration. Democratic lawmakers have called for the declassification of all related documents to ensure accountability and public trust. The Department of Justice has yet to respond to these demands.
As the situation continues to evolve, the long-term implications for Tesla and its leadership remain uncertain. Investors and stakeholders are closely monitoring developments, particularly any official responses from the administration regarding federal contracts and the Epstein file allegations. The resolution of these issues will likely play a critical role in determining Tesla’s trajectory in the coming months.
Market analysts advise caution, noting that political entanglements can have profound effects on corporate performance and investor confidence. The unfolding Musk-Trump saga serves as a stark reminder of the intricate interplay between politics and business in today’s interconnected world.
