It’s not unusual for Tesla’s stock to ride a wild wave — but this latest nosedive has more to do with politics than production lines.
The tech billionaire Elon Musk and former President Donald Trump are back at it again, trading blows on social media, and this time, it’s taking a serious toll on Tesla’s performance in the markets.
Let’s unpack what’s going on behind the scenes.
Musk Slams Trump’s New Spending Plan
The drama kicked off when Elon Musk took aim at Trump’s latest tax and spending bill.
The bill, rumored to carry a massive $3 trillion price tag, didn’t sit well with Musk.
He blasted the plan on X (formerly Twitter), calling it a one-way ticket to “DEBT SLAVERY.”
And he didn’t stop there — Musk even hinted at bankrolling primary challengers to Trump-loyal candidates who supported the legislation.
Trump Fires Back With Threats and Shade
Trump wasn’t about to let Musk have the last word.
In a fiery post on Truth Social, the former president slammed Musk for allegedly relying on government subsidies to build his business empire.
He went as far as threatening federal investigations into Musk’s companies — SpaceX, Tesla, and the Boring Company — and even floated the idea of deporting him back to South Africa.
“No more rocket launches, satellites, or electric cars — we’d save a fortune,” Trump quipped, taking a jab that was equal parts personal and political.
Tesla’s Stock Takes Another Hit
The fallout from this high-profile feud was immediate.
Tesla shares dropped between 5.5% and 7% in early trading Tuesday morning.
That’s on top of a nearly 13% dip over the past five days. The company remained tight-lipped when asked for a comment by DailyMail.com.
For investors, it was yet another jolt in a rollercoaster ride that’s become all too familiar.
A Once-Powerful Alliance Has Now Cracked
Ironically, this war of words comes just months after Musk and Trump were considered political allies.
During the 2024 campaign, Musk threw his support — and his wallet — behind Trump, contributing record-breaking sums to his campaign.
In return, Trump helped loosen the grip of federal regulators on Musk’s business empire.
That gave Musk more freedom to push forward with controversial self-driving releases, satellite systems, and large-scale tunneling projects.
Tensions Grow As Investigations Pile Up
Despite the initial benefits, the relationship soon began to fray.
Federal agencies like the NHTSA, FCC, and EPA were already circling Musk’s companies over safety, land usage, and technology concerns.
Though some investors believed Trump’s influence might protect Musk, that illusion quickly faded.
As Musk became a more visible figure in Washington — even briefly leading a cost-cutting initiative called DOGE — shareholders started to worry that he was losing focus on Tesla.
The company was already dealing with slowing global sales, an aging vehicle lineup, and delays in long-promised innovations.
Stock Swings Mirror the Musk-Trump Drama
After months of instability, Musk eventually stepped away from his White House role in May — and Tesla’s stock soared by 20% in just three days. That bounce didn’t last long.
Just days later, Musk again went after Trump’s tax proposals, calling them bloated and unnecessary.
Trump retaliated, and investors once again pulled out.
The saga continued through June, with stock prices briefly recovering after a possible reconciliation and a successful Robotaxi launch in Texas.
Volatility Is the New Normal for Tesla Shareholders
For those holding Tesla shares, this kind of unpredictability is nothing new.
According to investment analyst Bret Kenwell from eToro, this wild volatility is simply part of the Tesla experience.
“Volatility has been the price of admission for the stock’s long-term gains,” Kenwell explained.
“Some investors thrive on it, but many others will steer clear of Tesla — no matter how exciting its future technologies may look.”
What Comes Next?
With two of the world’s most powerful and unpredictable figures still exchanging barbs, there’s no telling where Tesla’s stock will go next.
What’s clear is that Musk’s entanglement with politics continues to blur the line between innovation and instability — and investors are buckled in for whatever comes next.