Tesla's CEO, Elon Musk, is adopting a more circumspect approach following his intensifying conflict with President Trump and the subsequent stock market plummet.
In the tumultuous year of 2025, the public spat between entrepreneur Elon Musk and President Donald Trump had a significant and **notably negative impact on Tesla's stock performance**. The feud, which began in mid-June, represented "another overhang" on Tesla's stock performance and was considered a "nail in the coffin" for the electric vehicle maker, according to Ross Gerber, a longtime investor and CEO of Gerber-Kawasaki Wealth Management[1].
Tesla's shares were already down **22% year-to-date** amid broader challenges such as weak vehicle deliveries and uncertainties in Musk's various business initiatives, including robotaxis[1]. Gerber warned that the stock could potentially fall **as much as 50% if the market revalues Tesla**, emphasizing that investors are growing weary of the ongoing conflict between Musk and Trump, which further dampens confidence[1].
The feud between Musk and Trump began on June 5, when Musk accused Trump of ingratitude in a tweet. The relationship between the two clashed publicly, with Trump denying Musk's accusation and threatening to withdraw orders and subsidies for Musk's companies[1]. This threat led to Musk announcing the retirement of the SpaceX Dragon capsule, which is needed to supply the International Space Station[1].
The public spat caused Tesla's stock to come under significant pressure. Initially, the Tesla stock recovered in the morning of June 5, up around 7% at $303. However, it closed down **14.26%** at $284.70 due to the ongoing conflict[1]. This decline resulted in the company losing over $150 billion in value in a single day[1].
However, it seemed that the spat between Musk and Trump was resolved, with officials in the White House working to smooth things over[1]. A phone call between Trump and Musk was supposed to be arranged for Friday[1]. Furthermore, President Trump may soon sell the red Model S he bought at the show in March, according to the Wall Street Journal[1].
In response to the U.S. budget draft, Musk called it "disgusting" without directly criticizing the president[1]. Musk's accusation of ingratitude and Trump's subsequent threats may have contributed to Tesla's stock decline, but the situation appears to be evolving.
[1] Source: CNBC, June 10, 2025.
- The public feud between Elon Musk and President Donald Trump, which began on June 5 and had a 'notably negative impact' on Tesla's stock performance, also contributed to Tesla's shares being down 22% year-to-date, according to Ross Gerber.
- In the midst of this tumultuous year, the ongoing conflict between Musk and Trump, considered a 'nail in the coffin' for Tesla, could potentially further lower Tesla's stock if the market revalues it, Gerber warned, as investors are growing weary of the situation.
