The once-cordial alliance between Elon Musk, owner of Tesla and SpaceX, and former President Donald Trump has turned into a public rift. Musk had supported Trump during the 2024 campaign and even engaged with the Republican administration. However, both now exchange jabs in public, signaling the end of what analysts call a "rollercoaster" relationship. The tensions reportedly began in mid-2024 when Musk initially endorsed Trump for re-election but later criticized Republican spending plans. Trump recently expressed disappointment over Musk's remarks and suggested retaliatory measures against Musk’s business interests. Musk responded on social media, claiming Trump would not have been re-elected without his support and hinted at forming a new political party aimed at moderates.
The exchanges intensified on social platforms. Trump proposed cutting government subsidies and contracts benefiting Musk’s companies—primarily Tesla and SpaceX—as part of budget reduction efforts. In a Truth Social post, Trump described these cuts as the “simplest way to save billions of dollars.” Musk, in turn, mocked Trump’s statements on X (formerly Twitter), accusing him of dishonesty and labeling him ungrateful. Musk even briefly considered suspending SpaceX operations as a form of protest but retracted after feedback from his followers.
The conflict’s implications stretch beyond politics. Tesla's stock experienced significant volatility, dropping over 14% during the height of the dispute. SpaceX, heavily reliant on government contracts, faces potential risk to its $22 billion agreements with NASA and the Pentagon. Furthermore, Trump’s proposed rollback of federal emissions standards could dismantle a lucrative carbon credit market that has benefited Tesla. Experts note, however, that replacing SpaceX in key space programs would not be straightforward due to its dominant market position and the lack of competitors.
Politically, the split highlights growing tensions within Republican circles. Trump’s conservative base views Musk as ungrateful, while Musk's followers, including tech enthusiasts and moderates, feel betrayed by Trump’s actions. Musk even polled his followers on the need for a new political party, receiving overwhelming support for the idea and suggesting the name “America Party.” Meanwhile, Trump declared in interviews that his relationship with Musk is “over” and avoided immediate action on critical SpaceX contracts, though the future remains uncertain.
Experts believe the fallout may have lasting effects. Politically, it signifies an unexpected fracture in Republican leadership, with a prominent tech entrepreneur distancing himself from the president. Economically, it could lead to regulatory and contractual hurdles for Musk’s businesses. As the feud unfolds, both Musk and Trump’s reputations—and billions in investments—hang in the balance.