Elon Is Asking For It: What Musk’s Latest Trump Spat Means As Tesla Sales Sink
Key Takeaways
Second-quarter vehicle deliveries are forecast to see one of the company’s biggest ever year-over-year declines and the Senate version of Trump’s budget bill phases out EV tax credits.
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July 1, 2025
03:22 PM
Forbes
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Elon Musk Speaks During A town Hall Event In Green Bay, WisconsinThe Washington Post via Getty Images Elon Musk’s tantrum over President Donald Trump’s budget bill that adds trillions of dollars to the federal deficit raises the possibility that the intemperate billionaire is once again courting new risks for his companies, especially Tesla
The spat comes as the carmaker is expected to post a big drop in electric vehicle sales tomorrow
Meanwhile, it’s to lose federal incentives for EV sales and charging services, and its posed robotaxi may hinge on whatever federal regulations the Trump administration cooks up
It’s a “soap opera that remains an overhang on Tesla's stock with investors fearing that the Trump Administration will be more hawkish and show scrutiny around Musk-related U
Government spending [for] Tesla/SpaceX and most importantly the autonomous future with the regulatory environment key to the future of Robotaxis and Cybercabs,” Dan Ives, an equity analyst for Wedbush said in a re note
Musk’s companies have sucked in at least $30 billion of public support since 2010 Given how reliant Tesla and SpaceX have been on federal support for the past 15 years, he has much to lose
Forbes estimates Musk’s companies have sucked in at least $30 billion of public support since 2010, including lucrative rocket launch and satellite contracts for SpaceX, a low-cost federal loan for Tesla’s first factory and billions of dollars of free money it generates selling federal and California pollution credits
Is highly reliant on SpaceX, so it’s less ly to suffer in the near term
Tesla, however, will undoubtedly be hurt by the elimination of $7,500 tax credits for EV buyers, now ly to phase out in September, and the end of government support for a national EV charging network it’s benefited from
The company could also suffer if the U
Transportation Department were to craft stricter national safety requirements for autonomous vehicles and robotaxis, which Musk has been touting as a major new revenue source for Tesla
For the in clean and sustainability news, here for our Current Climate
After a decade of steady global growth, Tesla’s sales have stalled over the past year, dropping 13% in the first quarter
Consensus estimates expect Austin-based Tesla will report deries tomorrow of 380,000 electric cars and crossovers in the three months that June 30, down 14% from a year ago
And that may be optimistic
Analysts Deutsche Bank’s Edison Yu see a far sharper decline, down as much as 20% to 355,000 units, with sales plunging most sharply in Europe, down in North America and even in China, Tesla’s biggest fit center. “We expect Tesla’s 2Q25 deries to miss sell-side consensus expectations, but this shouldn’t come as a surprise as buy-side expectations are already materially lower at the moment,” Yu said in a re note
For the full year, he now expects the company to sell 1. 6 million vehicles, down nearly 10% from 2024
Tesla’s slide over the past year coincided with what was until recently Musk’s outspoken and financially generous support for Trump
But after stepping down in May from his role leading the DOGE initiative, much-criticized for haphazardly slashing thousands of federal jobs, Musk clashed with Trump over the so-called “One Big Beautiful Budget Bill” in early June, complaining how much it increased federal spending
Six days later, he reversed course and tried to smooth things over with the U
President even deleting a post linking Trump to the Jeffrey Epstein scandal
But he broke his relative silence last week after the release of a draft version of the Senate bill which would increase the deficit by $3. 2 trillion, even more than a version that passed the House by a single vote. “It is obvious with the insane spending of this bill, which increases the debt ceiling by a record FIVE TRILLION DOLLARS that we in a one-party country – the PORKY PIG PARTY. ” he wrote on X on Monday
While Musk’s criticism has focused on government spending, he’s also complained that “Trump's bill will eliminate millions of jobs in America and cause huge strategic damage to our country. ” The plan “gives concessions to old industries but will destroy future industries. ” In response to his complaints and claims he’ll spend heavily to defeat members of Congress who voted for the legislation, Trump said he might have to “put DOGE on Elon
DOGE is the monster that might have to go back and eat Elon
I don’t think he should be playing that game with me. ” Trump suggested he would “take a look” at potentially deporting the world’s wealthiest person, a native South African who’s a naturalized U
That’s bably unly, but Trump can inflict significant pain on his former patron by turning up the heat on investigations into Tesla
For example, he could push the National Highway Traffic Safety Administration to intensify its long-running be of Tesla’s Autopilot and Full Self-Driving features that are linked to multiple fatal accidents
Or he could pressure the Securities and Exchange Commission to review the veracity of some of Musk’s public Tesla s, and even scrutinize the company’s heavy reliance on manufacturing in China. "He's upset that he's losing his EV mandate
He's very upset,” Trump told reporters on Tuesday. “He could lose a lot more than that, I can tell you that. ” Tesla s fell 5. 4% to $300. 44 in early afternoon Nasdaq trading
They’re down 26% this year
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