Tesla Stock Plummets 14% Amid Musk-Trump Feud Over Spending Bill

Tesla stock experienced its most significant drop since March, falling 14%, following a public exchange between Elon Musk and President Trump over a spending bill. The stock’s decline marked its biggest intraday drop since September 2020, closing 14% lower—the largest closing loss since March. Tesla shares are now down approximately 30% year-to-date.

The stock plummeted as much as 18% before recovering slightly, driven by the escalating feud between the president and the world’s richest person over the budget bill in Congress. At its lowest point, Tesla’s shares were down roughly 32% year-to-date, pushing the company’s market cap well below the $1 trillion threshold.

Paul Hickey, co-founder of Bespoke Investment Group, attributed Tesla’s decline to the Trump-Musk feud over the tax bill, suggesting it could lead to punitive actions. “Musk is already kicking himself out of the good graces of the Left. So, if you fell out of the good graces of the Right, that wouldn’t necessarily be good,” Hickey noted.

The conflict represents a significant shift in the Musk-Trump relationship, which was previously marked by concerns over their closeness. Musk criticized the GOP tax and spending bill as a “disgusting abomination” and urged his followers to “kill the bill,” citing its potential to increase the budget deficit and undermine the Department of Government Efficiency.

In response, Trump expressed disappointment with Musk, claiming he had detailed knowledge of the bill. Musk refuted this on X, stating the bill was never shown to him and was passed quickly without proper review. Tesla and the White House have not yet commented on the situation.