The latest social media battle between President Donald Trump and former advisor-turned-critic Elon Musk has not been good for Tesla, the electric car company the billionaire runs.
Tesla’s stock was down 7% to $293.16 per share an hour into trading on Monday morning — resulting in about $70 billion being shaved off of its market cap. The company, which recently launched its new self-driving “Robotaxi” fleet in Austin, was knocked below the $1 trillion valuation threshold as a result; it is worth about $945 billion on Monday morning.
That hefty stock drop comes after a wild weekend in which Musk said he was starting a new political party, the “American Party,” to combat government spending; Musk said he was launching the party after conducting a poll on X, the social platform he owns, in which users said they favored a third major party in the U.S. by a two-to-one margin.
President Trump blasted Musk for the move on Sunday, saying in a Truth Social post he was “saddened” to see Musk go “off the rails.” The president then said Musk has been “becoming a TRAIN WRECK over the past five weeks.”
The Tesla and SpaceX boss has been vocal recently about his disdain for the Trump-backed “Big Beautiful Bill.” He skewered the bill in early June — just days after departing as the head of the Department of Government Efficiency with a gold key to the White House — saying it was a “disgusting abomination.”
Tesla’s stock price took a hit following his initial criticism, as well as other headline-grabbing comments, like claiming President Trump did not want to release the Epstein Files because he was named in them. It had rebounded recently, though, hitting $350 per share on June 23, before declining once again.
Musk’s war of words with the president stands out, considering he not only led DOGE for him, but spent $275 million during the 2024 election to help Trump and other Republicans win their races. Wedbush analyst Dan Ives, in a note to clients this weekend, noted some Tesla shareholders are tired of seeing Musk spend time on politics.
“There is a broader sense of exhaustion from many Tesla investors that Musk keeps heading down the political track,” Ives said.
Following Monday’s decline, Tesla’s stock price is down 23% since the start of the year.
