Tesla’s drops $380 billion after Musk calls Trump’s measure a ‘disgusting abomination’
Tesla’s market value plummets by $380 billion following Musk’s characterization of Trump’s bill as a ‘disgusting abomination.’ What commenced as a dynamic camaraderie between two of the globe’s most contentious figures—Donald Trump and Elon Musk—has now escalated into a full-scale, ego-driven conflict in both the political and financial arenas. The outcome? A staggering $380 billion has vanished from Tesla’s market capitalization. The situation escalated when Musk openly criticized Trump’s new tax-and-spending bill on X, labeling it a “disgusting abomination.” Trump, always vocal, responded with a warning: he would revoke federal contracts from Tesla and SpaceX—Musk’s esteemed enterprises.
The market swiftly made its choice. Tesla shares plummeted 14 percent in just one day, wiping out $150 billion in value—the most significant one-day decline in the company’s history. With a further 30 per cent decline this year, Tesla has now secured the dubious distinction of being the worst-performing large-cap stock of 2025. Billionaire bromance has come to an end. Just months ago, Musk was perceived as a significant behind-the-scenes advocate for Trump’s return bid. Now, the camaraderie has devolved into animosity.
Tesla, previously the world’s eighth most valuable company, has now fallen to tenth place, with a valuation of $917 billion. For context, that amounts to over ₹31 trillion wasted. It could not have arrived at a more inopportune moment. Tesla faces mounting challenges, including a decline in electric vehicle demand, increasing scrutiny from global regulators, and concerns regarding Musk’s associations with far-right organizations. Simultaneously, other companies associated with Musk are experiencing the repercussions. Destiny Tech100, an investor in SpaceX, experienced a decline of 13 per cent. According to Ortex, short sellers amassed nearly $4 billion on Thursday alone—the second-largest one-day earnings recorded to date.
‘You refer to the individual who has seemingly lost his mental faculties?’ In a discreet setting, the White House is said to have attempted to negotiate a ceasefire through a conversation involving Trump and Musk. That ship appears to have departed. In response to the inquiry, Trump remarked: “You mean the man who has lost his mind?” He stated that he wasn’t “particularly” interested in engaging in conversation with Musk.
However, Trump did not cease his actions at that point. In a post on Truth Social, he stated: “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts.” I have consistently found it surprising that Biden did not take that action!” He asserts that Musk’s indignation arises from the suggested repeal of the EV mandate. “Elon was ‘wearing thin,’ I asked him to leave.” I revoked his EV Mandate… and he simply lost his composure!” Musk, always unreserved, responded with a fiery retort. He charged Trump with a lack of gratitude following his $300 million campaign contribution, took credit for Trump’s potential victory in 2024, and intertwined Epstein in the discussion. His concluding remark on X: “Have a nice day, DJT!”
Tesla’s political nightmare. As the conflict of rhetoric intensifies, the repercussions extend beyond the personal realm—it has become political. Musk has recently stepped down from his advisory position within the Trump camp, allegedly due to pressure from shareholders. However, his sudden departure has instigated political upheaval throughout Tesla’s domain. Given that Tesla, SpaceX, and Starlink depend on federal contracts and regulatory goodwill, a deteriorating relationship with Washington could have significant financial implications.
Meanwhile, Apple is not insulated from the political tempest either. The market capitalization has decreased by 20 percent this year, now standing at $2.99 trillion, which positions it in third place globally. Trade tensions, AI rivals, and China’s slowdown are all to blame. “The last thing they want is for Trump to go from being Musk’s biggest cheerleader to his biggest threat,” he was quoted as saying by Bloomberg. And that is not merely rhetoric. Should Trump’s tax bill be enacted and if EV credits are phased out sooner than anticipated, JPMorgan projects that Tesla might forfeit $1.2 billion in profits. For an automaker already facing significant challenges, that’s no minor setback.
Amidst the prevailing turmoil, Tesla is preparing for a significant strategic shift. On June 12, the long-anticipated robotaxi service will finally be unveiled in Austin, Texas. “The robotaxi launch signifies the beginning of Tesla’s next growth chapter.” Nevertheless, he warns that the path forward is fraught with challenges. “This is certainly a somewhat nerve-wracking time for Tesla investors.”
