Tesla shares crater as Trump, Musk feud goes nuclear

Tesla on Thursday suffered its worst single-day drop in more than four years as CEO Elon Musk’s feud with President Trump went nuclear.

Shares in the electric vehicle maker tanked $47.35, or 14%, to $284.70, wiping out $153 billion in market value.

Aside from the caustic back-and-forth between the Leader of the Free World and the world’s richest man, Tesla investors bailed over the possible loss of EV tax credits worth as much as $7,500 that was passed by the House in the Trump-backed “Big Beautiful Bill.”

3

The demise of the EV tax credits, which still needs Senate approval, could hit Tesla’s annual profit by $1.2 billion, JPMorgan analysts said Thursday.

The Senate, meanwhile, recently passed legislation to block California’s EV sales mandates that could chop another $2 billion off Tesla’s sales, according to JPMorgan.

“The quickly deteriorating friendship and now ‘major beef’ between Musk and Trump is jaw-dropping and a shock to the market, and putting major fear for Tesla investors on what is ahead,” Wedbush Securities analyst Dan Ives wrote in a note on Thursday.

The Tesla bull said the feud does not change Wedbush’s optimism about the company’s future.

But the put-call ratio for Tesla options spiked to its highest level since late April, according to Cboe Global Markets.

Whatever.

Keep the EV/solar incentive cuts in the bill, even though no oil & gas subsidies are touched (very unfair!!), but ditch the MOUNTAIN of DISGUSTING PORK in the bill.

In the entire history of civilization, there has never been legislation that both big and beautiful.…

— Elon Musk (@elonmusk)

That means investors were flocking to bearish put options that would pay out if the stock continues to crater.

Tesla’s shares had enjoyed a more than 22% rally through May before Musk tore into Trump’s bill – despite dismal results from the automaker.

The stock is down 25% for the year following Thursday’s decline.

---

Here is the latest on Donald Trump and Elon Musk’s feud

• Trump doesn’t rule out reconciliation with Elon Musk as he sits down with Miranda Devine for ‘Pod Force One’
• Elon Musk admits some posts he wrote about Trump ‘went too far’
• Trump sounds off on Elon Musk after billionaire blasted prez’s ‘big beautiful bill’
• President threatens to cut ‘Billions and Billions of Dollars’ in federal funding for Elon Musk’s companies as feud goes nuclear
• Donald Trump responds to Elon Musk’s late-night apology after ugly public feud

---

Musk’s personal fortune took a $26.6 billion hit, according to Forbes’ Real-Time Billionaires List, putting his net worth at $387.9 billion — still well ahead of Facebook founder Mark Zuckerberg’s $236.3 billion.

Tesla remains the most valuable automaker worldwide by a long shot — carrying a market value of more than $1 trillion, far surpassing Toyota Motor’s market value of about $290 billion. 

Tesla trades at 140.21 times profit estimates, a steep premium to other Big Tech stocks like Nvidia.

3

Still, sales of Tesla vehicles have plummeted in major markets across Europe, demoted to second place in some countries to up-and-coming Chinese rival BYD. 

The brand’s reputation has taken a beating in the US as demonstrators across the country protested Musk’s role in slashing government spending.

He stepped away as the de facto head of DOGE last week.

3

The mogul — who owns X, SpaceX, Neuralink and xAi — may soon feel the full impact of beefing with the Trump administration.

On Thursday, the Securities and Exchange Commission gave him a six-week extension to respond to its civil lawsuit accusing him of waiting too long to reveal his Twitter stake in 2022 before buying the social media megaphone.

Musk’s nearly two-week delay in disclosing his 5% stake in Twitter, since renamed X, allowed him to buy more than $500 million worth of shares at artificially low prices while investors were left in the dark, the SEC has argued.