Tesla shares hit another Trump slump as feud between president and Musk reaches a boil

As the verbal sparring between the billionaire and President Donald Trump over the massive bill of tax advantages and expenditure cutbacks intensifies once further, shares of Elon Musk’s electric vehicle company, Tesla, fell Tuesday. Musk has hinted that he may start a new political party.

As global sales of Tesla’s cars decline due to increased competition and criticism of Musk and his ties to the Trump administration, the company’s stock has already fallen more than 20% this year. Both China and Europe are seeing a sharp decline in Tesla sales. According to the China Passenger Car Association, Tesla sales in China fell 15% in May compared to the same month last year, which is more than twice as much as the previous month.

During morning trade, Tesla’s stock dropped more than five percent.

Investors in Musk’s businesses are constantly negatively impacted by the restart of hostilities between Trump and Musk, who is also the CEO of SpaceX.

Wedbush Securities analyst Dan Ives wrote on Tuesday that the BFF situation has now devolved into a soap opera that continues to weigh on Tesla’s stock as investors worry that the Trump Administration will be more hawkish and scrutinize Musk’s US government spending related to SpaceX and Tesla, and most importantly, the autonomous future with the regulatory environment crucial to the future of Robotaxis and Cybercabs. Since the Street will be worried that Trump and Musk’s once-close friend relationship would backfire and turn into an enemy, we would anticipate that the stock would be weak when trading opens this morning.

The president’s large bill is the main point of contention in Musk and Trump’s relationship. Over the weekend, Musk intensified his criticism of the plan, claiming that the legislation that Republican senators are rushing to approve would stifle emerging sectors and eliminate employment.

On Saturday, Musk wrote on X that the bill will be the Republican Party’s electoral death knell.

Musk said he will try to remove lawmakers who support the plan from office next year as the Senate works through a contentious nighttime session that continued into Tuesday.

He said on X, “Every member of Congress who ran on a platform of cutting government spending and then voted for the largest debt increase in history should hang their head in shame.” And if I die on this planet, they will lose their primary the following year.

On the social networking site, the post had 26 million views.

Musk wrote a post a few hours later saying that if the measure is approved, he will start a new political party.

He wrote, “The America Party will be formed the next day if this crazy spending bill passes.” For the people to truly have a voice, our nation needs an alternative to the Democrat-Republican uniparty.

On X, Musk’s article regarding the America Party received 32 million views.

EV regulations and subsidies were the subject of several of Trump’s attacks on Musk. Trump said in an early Tuesday post on Truth Social that Musk was aware of his opposition to an EV mandate and that people shouldn’t be compelled to acquire electric cars.

According to Trump, Elon might receive considerably more subsidies than any other person in history, and without them, he would most likely have to shut down his business and return to South Africa.

Trump also said that the United States might reduce spending by focusing on areas of the economy where Musk is a major player.

Our nation would save a fortune if there were no more rocket launches, satellites, or electric car production. Maybe we ought to have DOGE look at this closely. A LOT OF MONEY WILL BE SAVED! In his article, Trump made reference to the cost-cutting organization that, until recently, was led by Musk.

A few hours later, Trump continued to criticize Musk and what he considers to be his greatest grievance—the billionaire’s annoyance about perhaps losing EV subsidies—while he was standing on the White House lawn before leaving for Florida.

He’s furious. Trump replied, “I’ll tell you right now, he can lose a lot more than that.” Elon has a lot more to lose than that.

Trump said that the Department of Government Efficiency, or DOGE, might return to harm the billionaire when a reporter asked him whether he was planning to deport Musk.

Trump stated, “We’ll have to look.” Elon may need to be placed under DOGE. Are you familiar with DOGE? The monster that could have to return and devour Elon is DOGE. Would that not be awful? He receives numerous subsidies.

Despite Musk’s response on X that he would not escalate the conflict, he continued to attack Trump and Republicans.

Given that this plan raises the debt ceiling by $5 trillion, what good is Doge saving $160 billion? He wrote that it is a disgrace to the work.

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