By Jemimah Wellington, JKNewsMedia Reporter
MARKETS REELED as a high-stakes confrontation between United States (US) President Donald Trump and Elon Musk sent Tesla shares into freefall, wiping more than $150 billion off the automaker’s market value.
The fallout from their deteriorating relationship, once defined by cautious collaboration, has now erupted into a bruising public clash with major implications for the tech industry, US policy, and investor confidence.
The rupture traces back to Trump’s first year in office, when Musk accused the president of dismantling efforts led by the Department of Government Efficiency (DOGE), a unit he briefly headed as a special government employee.
The tipping point came last week, when Musk vacated his DOGE post a day after slamming the Trump-backed “Big Beautiful Bill” for gutting environmental standards in favour of tax breaks and heightened border security funding.
Though Musk cited the completion of a 130-day public service term, Trump claimed he had forced the exit.
In a Thursday post on Truth Social, the president said Musk was “wearing thin” and had lost the administration’s trust, referencing the rollback of the electric vehicle (EV) mandate that had pushed for zero-emission sales targets of 35 percent by 2026 and 100 percent by 2035.
“I asked him to leave,” Trump wrote. “I took away his EV Mandate that forced everyone to buy electric cars that nobody else wanted, and he just went CRAZY!”
Musk fired back, branding the statement “an obvious lie”, then accused Trump of being linked to the Jeffrey Epstein case.
“Mark this post for the future. The truth will come out,” he posted.
Without presenting evidence, Musk escalated the feud further by endorsing a call for Trump’s impeachment and suggesting Vice-President JD Vance should replace him.
The tech billionaire also predicted a Trump-induced recession in the second half of the year due to planned tariffs.
In an earlier exchange, Musk criticised Trump’s attitude as ungrateful, claiming the former president would not have won office without his influence.
The market backlash was swift. Tesla shares nosedived by over 14 percent to $284.7 at Thursday’s close, dragging its valuation below $900 billion.
The broader Nasdaq Index dipped by 0.8 percent amid rising fears about Tesla’s exposure to federal scrutiny and the stability of its government contracts, particularly those tied to SpaceX.
Musk’s plans to roll out autonomous robotaxi services in Austin, Texas, this year, with further expansions through 2026, now face growing uncertainty. European vehicle sales have also slowed, compounding the crisis.
Meanwhile, US regulators have renewed scrutiny into Tesla’s autopilot system following the resurfacing of a fatal 2023 crash allegedly linked to the software.
Musk’s personal fortune has taken a hit of nearly $27 billion in the wake of the political storm, though he remains the world’s wealthiest individual.
At the time of publication, Tesla had not released any official statement regarding the ongoing dispute or its market fallout.
