Elon Musk Could Face Billions in Losses Amid Escalating Feud with Donald Trump

NEW YORK (AP) — What happens when the world’s richest man tangles with one of its most powerful politicians? For Elon Musk, the stakes couldn’t be higher — the ongoing spat with former President Donald Trump could cost him billions and seriously disrupt several of his flagship ventures.

From Tesla’s ambitious push into self-driving robotaxis to SpaceX’s crucial NASA missions, and even the future of Musk’s social media platform, X, the fallout depends largely on how far Trump wants to take this grudge match.

Tesla’s Robotaxi Dream Hangs in the Balance

Tesla was gearing up for a big moment: testing its driverless taxis in Austin, Texas — a potential game-changer as sales of its electric vehicles falter in some markets. But Trump could throw a wrench in the works by pushing federal safety regulators to scrutinize Tesla’s robotaxis more aggressively.

In fact, even before tensions flared, the National Highway Traffic Safety Administration (NHTSA) was already probing how Tesla’s self-driving cars handle tricky, low-visibility conditions. This follows a major investigation last year into over 2 million Teslas after several crashes — including a fatal pedestrian accident.

A NHTSA spokesperson says the probe is ongoing and that the agency will “take any necessary actions to protect road safety.”

The Department of Justice has also investigated Tesla’s safety record, though details remain murky.

Tesla’s stock had jumped 50% in anticipation of the robotaxi rollout, but the Trump-Musk feud sent shares tumbling over 14% on Thursday — recovering only slightly the next day.

Morningstar analyst Seth Goldstein summed it up: “Tesla’s recent rise was almost entirely driven by robotaxi enthusiasm. Elon’s feud with Trump could be a negative.”

The Carbon Credit Blow

One lesser-known but vital part of Tesla’s business is selling carbon credits — regulatory allowances that help other automakers meet environmental standards. This side hustle raked in nearly $600 million in the first quarter alone.

But Republican senators, aligned with Trump, inserted language into a budget bill that could eliminate penalties on gas-guzzling cars, potentially undercutting Tesla’s lucrative carbon credit sales.

Musk has downplayed the importance of this business, but such changes could hurt Tesla as it already faces boycotts from environmentally conscious buyers put off by Musk’s political leanings.

Sales Slump and a Shaky Comeback

Musk’s political flirtations with Trump have cost Tesla dearly among the green-minded, who once championed the electric car revolution. While distancing himself from Trump might bring some buyers back, it’s far from guaranteed.

Earlier this year, some analysts hoped Tesla might gain traction in conservative areas, but recent developments have dimmed that outlook.

TD Cowen analyst Itay Michaeli put it plainly: “There are more questions than answers. It’s too early to tell the lasting impact.”

Michaeli recently downgraded Tesla’s stock target from $388 to $330. Tesla shares hovered around $300 as of Friday.

SpaceX Faces Threats to Vital Government Contracts

The feud isn’t just about cars. Trump has openly threatened to cut government contracts to SpaceX, Musk’s private rocket company — a move that could cripple a firm valued at roughly $350 billion.

SpaceX is critical to NASA, ferrying astronauts to the International Space Station with its Dragon capsules and preparing for a moon mission next year.

If SpaceX falters, the U.S. risks relying again on Russian Soyuz capsules for space travel — a politically and strategically sensitive fallback.

Musk fired back with a dramatic threat to retire the Dragon spacecraft but later softened his stance, leaving many unsure how serious he was.

Starlink’s Future Could Shift Too

SpaceX’s satellite internet service, Starlink, has recently scored international deals, some possibly boosted by Musk’s once-close ties to Trump. For example, Saudi Arabia approved Starlink services during a recent Middle East trip with Trump, and India just granted a key license, opening access to millions without internet.

It’s unclear how much politics influenced these wins, and how much pure business.

Advertisers on X: Back and Forth

After a mass advertiser exodus from Musk’s social platform X — driven by concerns over conspiracy theories and content moderation — many big brands started creeping back, wary of a conservative backlash if they stayed away.

Musk called the boycott “illegal” and sued advertisers, while the Trump administration pushed for an FTC investigation into possible coordination among them.

But now, with Trump’s souring relationship with Musk, advertisers might again see X as too politically risky.

Cornell political scientist Sarah Kreps cautions: “The risk of a new exodus depends heavily on how the conflict unfolds, how long it lasts, and how it ends.”

What’s Next?

The Musk-Trump showdown is far from over — and its ripple effects could reshape key industries from electric vehicles and space exploration to global internet access and social media.

For Elon Musk, the price of this feud could run into the billions, but for the U.S. and its technological future, the risks are just as profound.