- Trump Threatens to Revoke Federal Contracts, Accuses Musk of Riding on Subsidies
- Musk Slams $4 Trillion Tax Bill, Warns of New Political Party if EV Credits Are Cut
- Tesla Stock Plunges $150 Billion Amid Feud, EV Incentive Cuts Loom Large
New Delhi: President of the United States of America Donald Trump sparred publicly with Tesla CEO Elon Musk, with Trump alleging Musk enjoyed “huge government subsidies” and threatening to investigate his contracts, while Musk lambasted Trump’s tax bill as a danger to the U.S. economy.
On his Truth Social platform, Trump stated that Musk received “more government subsidies than any man in history.” Otherwise, Musk would have to close Tesla, SpaceX, and other ventures, and he would ‘move back to South Africa,’ he added. TRump also mentioned that he conducted his review of Musk’s contracts and referred to the Department of Government Efficiency, which Musk briefly led for about five minutes, as DOGE. The conflict centres around Trump’s $1,500 tax credit proposal, which aims to eliminate the $7,500 electric vehicle (EV) tax credit by December 31, 2025; this plan could raise costs for Tesla vehicles.
In an X post, Musk referred to the proposed $4 trillion tax and spending plan as a “horrific monstrosity”, adding that it would “increase the U.S. deficit to infinity”. He also cautioned that he would establish a new “America Party” should the bill pass. Musk claimed the bill eliminates incentives for electric vehicles and solar energy while maintaining oil and gas subsidies. Tesla shares sank 14% on June 6, 2025, resulting in a loss of $150 billion in value due to earlier related tensions.
He defended the bill as the “largest tax cut ever” and dismissed EV mandates as a harmful policy from the Biden era. Trump was speaking at a news conference on July 1, where he said, “Musk knew all about the bill and was fine with it until the EV credit was cut.” Musk refuted this claim, asserting that he never received the contents of the bill.
Musk’s relationship with Trump has soured over the proposed changes, which seek to reverse and preserve an important EV credit, going as far as suggesting that Trump could cancel federal contracts worth billions for Musk’s companies.
Comments are closed.