The altercation between President Donald Trump and Tesla CEO Elon Musk on Thursday evening caused political unrest and sent markets into a bloodbath. Recent reports claim that White House aides have scheduled a Friday call between the two to repair what has become a high-profile public fallout.
It all began earlier this business week when Musk criticized President Trump’s “big beautiful bill.” The legislation, which bundles tax cuts, immigration enforcement, and government spending priorities, is currently under review in the US Senate. Musk’s main objection lies in the bill’s projected cost, estimated to increase the national deficit by $2.4 trillion.
As reported by Cryptopolitan, Trump said he was “disappointed” with the Tesla CEO because “he knew the inner workings of the bill better than anybody.” During a press briefing at the White House, the POTUS added that “he doesn’t know if he’ll continue to have a great relationship with Elon Musk.”
Washington moves in after back-and-forth commentary and accusations
According to Politico, behind the scenes, White House aides have reportedly asked Trump to tone down his social media “attacks” on Musk, because it could hinder the bill’s path through the Senate. In response to the plea, Trump has been using a more measured tone on his Truth Social account.
“I don’t mind Elon turning against me, but he should have done so months ago,” Trump wrote, while praising the bill as “one of the Greatest Bills ever presented to Congress” and ending with his signature slogan, “MAKE AMERICA GREAT AGAIN!”
Billionaire hedge fund manager Bill Ackman took to X to urge the “buddies” to reconcile, writing, “I support Donald Trump and Elon Musk and they should make peace for the benefit of our great country.” Shortly after, Musk quoted Ackman’s post with the reply, “You’re not wrong.”
The Tesla CEO had coined Trump’s bill as a “Big ugly law” and “disgusting abomination,” claiming it would erase the savings achieved by the Department of Government Efficiency (DOGE), the cost-cutting task force Musk co-founded and the President approved.
“It more than defeats all the cost savings achieved by the DOGE team at great personal cost and risk,” Musk told his followers earlier this week.
Political differences cause markets to shed gains
Musk-led Tesla’s shares nosedived on Thursday, closing down more than 14% after both sides hurled insults against each other. Analysts and investors argue the decline was caused by Musk’s diminishing ties to the White House, along with concerns over the consequences of the bill.
In Asia, major Chinese electric vehicle manufacturers including Hong Kong-listed BYD, the world’s largest EV maker, dropped nearly 2% at Friday’s open. Nio and Li Auto also saw intraday declines of 3.42% and 1.46% respectively.
“Trump’s comments extended a decline in Tesla shares,” said Dennis D**k, chief strategist at Stock Trader Network and a Tesla shareholder. “Elon’s politics continue to harm the stock. First, he aligned himself with Trump, which upset many potential Democratic buyers. Now, he has turned on the Trump administration.”
China ties part of relationship fallout
Elon Musk was not in support of the White House’s tariffs against China, where Tesla operates its largest factory outside the US. According to company records, the Shanghai plant has delivered billions in revenue after manufacturing over 3 million cars.
Musk has also met with top Chinese officials, including President Xi Jinping, over the years. In April, he told reporters that he advised Trump to reduce tariffs on China.
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