Tesla Suffers Worst Day Ever as Musk-Trump Fallout Wipes Out $152 Billion

Tesla shares plunged 14% on Thursday, wiping out over $150 billion in market value in the company’s biggest single-day loss ever. The electric vehicle giant’s market capitalisation fell below the $1 trillion mark, closing at $916 billion — a stunning drop triggered by a public rift between CEO Elon Musk and former U.S. President Donald Trump.

The sharp decline follows four losses in the last five trading sessions, as investor confidence wavered amid growing political drama. The fallout began after President Trump publicly criticized Musk over his opposition to the government’s latest spending bill, calling him “difficult” and suggesting Musk had “gone crazy.”

In a fiery post on his social media platform Truth Social, Trump wrote, “Elon was ‘wearing thin.’ I asked him to leave, I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!”

The president’s comments marked a dramatic shift from their earlier relationship. “Elon and I had a great relationship. I don’t know if we will anymore. I was surprised,” Trump said in a statement from the Oval Office. He added that Musk seemed angered by the exclusion of electric vehicle (EV) tax credits from the newly passed budget bill.

Musk quickly responded on X (formerly Twitter) with a dismissive “Whatever” during Trump’s media address. He then escalated tensions further by posting: “Without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate.”

The public exchange marked a significant shift in Musk’s political tone. Once a participant in Trump’s White House advisory group — humorously dubbed the Department of Government Efficiency, or DOGE — Musk has recently emerged as a vocal critic of federal spending. He called the new budget “a disgusting abomination” and urged voters to challenge any lawmaker supporting it.

Despite a 22% rally in Tesla’s stock during May, fueled by optimism around new tech developments, the recent political spat has sent shares tumbling nearly 18% in just one week. For the year, Tesla is now down nearly 30% from its December peak of $488.54 per share.

With mounting political tension and growing uncertainty around future government support for EVs, analysts say the fallout may extend beyond Tesla’s market value. It could reshape the delicate relationship between tech titans and policymakers in an increasingly polarized landscape.