President Donald Trump has escalated his sudden rupture with Elon Musk by implying the government could sever ties with the tech titan’s businesses.
“The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it” Trump wrote in a Truth Social post Thursday afternoon.
Various estimates have been put forward on just how much Musk’s firms, primarily SpaceX and Tesla, benefit from U.S. government contracts and subsidies. The Washington Post has put the figure at $38 billion, with SpaceX President and COO Gwynne Shotwell estimating that company alone benefits from about $22 billion in federal spending. Reuters has reported that the true figure is classified due to the nature of many of the contracts Musk’s firms are under.
Shares in Tesla, which had already fallen 8% on Thursday as the tit-for-tat escalated on social media, declined as much as 12% following Trump’s post. SpaceX is privately owned and its shares do not trade on the open market.
Trump’s threat comes in the midst of a stunning exchange with Musk that erupted into public view Thursday when the president told reporters in the Oval Office that he was disappointed with Musk’s criticism of the Republican policy bill that is making its way through Congress. Musk has blasted the bill, calling it a “disgusting abomination” amid concerns it would worsen the U.S. fiscal deficit.
Musk spent much of Thursday launching into a tirade on X, his social media platform where he posted a variety of critiques of Trump, the bill and other Republican politicians.
In response to one Trump post, Musk accused the president of lying.
A make-good on the threat would come at a sensitive time for Tesla, which has seen global sales plunge partly in response to Musk’s very involvement with the Trump campaign. Year to date, its shares are down some 25%.
The electric car maker has benefited from approximately $11.4 billion in total regulatory credits aimed at boosting electric-vehicle purchases, though that figure also includes state-level subsidies. Musk has claimed he no longer needs the credit, which he says primarily now benefits rivals.
