Tesla shares take hit as feud between Trump, Musk reaches boil
Washington, Jul 1 (AP): Shares of electric vehicle maker Tesla, which is headed by Elon Musk, slumped Tuesday as the war of words between billionaire and President Donald Trump over the big bill of tax breaks and spending cuts heats up again, with Musk saying he may form a new political party.
Shares of Tesla have already tumbled more than 20% this year as sales of the company's vehicles erode amid a backlash against Musk and his association with the Trump administration. Tesla sales are plummeting in Europe and China as well.
Tesla's stock fell nearly 6% in early trading.
The resumption of hostilities between Trump and Musk, also the CEO of SpaceX, is always bad news for investors in Musk's companies.
“This BFF situation has now turned into a soap opera that remains an overhang on Tesla's stock with investors fearing that the Trump Administration will be more hawkish and show scrutiny around Musk related US government spending related to Tesla/SpaceX and most importantly the autonomous future with the regulatory environment key to the future of Robotaxis and Cybercabs,” wrote Wedbush Securities analyst Dan Ives on Tuesday.
“We would expect the stock to be weak to kick off trading this morning as the Street will show concern that the Trump and Musk once BFF relationship now backfires and turns into a junior high school friendship gone bad into an enemy,” he said.
The most prominent divide in the relationship between Musk and Trump is the president's big bill. Musk ramped up his criticism of the bill over the weekend, arguing the legislation that Republican senators are scrambling to pass would kill jobs and bog down burgeoning industries.
Musk posted on X on Saturday that the bill would be “political suicide for the Republican Party”.
With the Senate working its way through a tense overnight session that dragged into Tuesday, Musk suggested he will work to get members of Congress who vote for the bill out of their seats next year.
“Every member of Congress who campaigned on reducing government spending and then immediately voted for the biggest debt increase in history should hang their head in shame,” he wrote on X. “And they will lose their primary next year if it is the last thing I do on this Earth.”
The post was viewed 26 million times on the social media platform.
A few hours later, Musk followed up with a post claiming he will create a new political party if the bill passes.
“If this insane spending bill passes, the America Party will be formed the next day,” he wrote. "Our country needs an alternative to the Democrat-Republican uniparty so that the people actually have a VOICE."
Musk's post about the America Party was viewed 32 million times on X.
Trump focused some of his criticisms of Musk on EV mandates and subsidies.
In a post on Truth Social early Tuesday, Trump said Musk has known that he's against an EV mandate and that people should not be forced to own electric vehicles.
“Elon may get more subsidy than any human being in history, by far, and without subsidies, Elon would probably have to close up shop and head back home to South Africa,” Trump wrote.
Trump also suggested that the US could cut back on spending by targeting segments of the economy in which Musk plays a significant roll.
“No more Rocket launches, Satellites, or Electric Car Production, and our Country would save a FORTUNE. Perhaps we should have DOGE take a good, hard, look at this? BIG MONEY TO BE SAVED!!!” Trump posted, alluding to the cost-cutting entity that until recently, was headed by Musk.
Several hours later, while standing on the White House lawn before heading to Florida, Trump continued to take shots at Musk and what he believes to be his biggest grievance, the billionaire's displeasure over potentially losing EV subsidies.
“He's very upset. You know, he can lose a lot more than that, I'll tell you right now," Trump said. "Elon can lose a lot more than that.”
When asked by a reporter if he was going to deport Musk, Trump warned that the Department of Government Efficiency, or DOGE, could come back to hurt the billionaire.
“We'll have to take a look," Trump said. "We might have to put DOGE on Elon. You know what DOGE is? DOGE is the monster that might have to go back and eat Elon. Wouldn't that be terrible? He gets a lot of subsidies."
Musk responded on X by saying he would refrain from escalating the conflict, but he took another shot at Trump and Republicans anyway.
“What good is Doge saving $160B when this bill increases the debt ceiling by $5T? It makes mockery of the work,” he wrote.
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NATO, others turn down US call for help in Hormuz: Trump
Washington (PTI): President Donald Trump on Tuesday said NATO and most of US' other allies have rejected his calls to help secure the Strait of Hormuz as the war with Iran entered the third week.
In a social media post, Trump asserted that Iran’s military has been “decimated” and he no longer felt the need for assistance from NATO countries or anyone else.
Last week, Trump had sought help from European nations and others who depend on oil supplies transiting from the Hormuz Strait to safeguard the critical waterway.
“The United States has been informed by most of our NATO “Allies” that they don’t want to get involved with our Military Operation against the Terrorist Regime of Iran, in the Middle East, this, despite the fact that almost every Country strongly agreed with what we are doing, and that Iran cannot, in any way, shape, or form, be allowed to have a Nuclear Weapon,” the US President said in a post on Truth Social.
Iran's attacks on Gulf nations and its grip on the Strait of Hormuz, through which a fifth of the world's oil is transported, have sparked increasing concerns of a global energy crisis and are unnerving the world economy.
“I am not surprised by their action, however, because I always considered NATO, where we spend Hundreds of Billions of Dollars per year protecting these same Countries, to be a one-way street — We will protect them, but they will do nothing for us, in particular, in a time of need,” Trump said.
He said Australia, Japan and South Korea too have turned down his call for help.
“Fortunately, we have decimated Iran’s Military – Their Navy is gone, their Air Force is gone, their Anti-Aircraft and Radar is gone and perhaps, most importantly, their Leaders, at virtually every level, are gone, never to threaten us, our Middle Eastern Allies, or the World, again,” Trump said.
He said that given the scale of recent military successes, the US no longer "need" or desires assistance from NATO countries, adding that it never relied on such support in the first place.
Speaking as President of the United States, the "most powerful" country in the world, "we do not need" help from anyone, Trump said.
The West Asia conflict began on February 28 when the US-Israeli combine conducted airstrikes on Iran.
The Strait of Hormuz, the narrow waterway that connects the Persian Gulf to the open ocean, has effectively been shut following the US and Israel attack on Iran and Tehran's sweeping retaliation.
However, Iranian Foreign Minister Abbas Araghchi had said that from Tehran's "perspective", the strait is "open". "It is only closed to Iran's enemies, to those who carried out unjust aggression against our country and to their allies.”
Earlier in the day, a second Indian-flagged LPG tanker, Nanda Devi, reached the country after safely sailing from the war-hit Strait of Hormuz. On Monday, the first ship, Shivalik, reached Mundra port in Gujarat.
As of now, 22 Indian vessels remain on the west side and two on the east side of the strait.
Indian authorities are in constant touch with all the relevant stakeholders in the region to secure the safe passage of the remaining ships, officials said.
