Trump Threatens Musk Over Subsidies Amid Feud

On June 5, 2025, President Donald Trump threatened to cut billions in federal subsidies and contracts for Elon Musk’s companies, including Tesla and SpaceX, escalating their public feud. The conflict followed Musk’s vocal criticism of Trump’s flagship tax-cut and spending bill, notably the removal of electric vehicle incentives, and resulted in a sharp drop of 8.2% to 9% in Tesla’s stock and turbulence in crypto markets such as Dogecoin. Trump labeled Musk as 'going crazy,' while Musk fired back, claiming Trump was ungrateful and that his support had been pivotal to Trump’s election victory. The dispute signifies the collapse of a previously close alliance, with Musk having contributed hundreds of millions to Trump’s campaign and policy agenda. Both parties exchanged accusations over legislative decisions, subsidies, and personal loyalty. The financial markets responded with risk aversion, reflecting the broader economic uncertainty driven by the feud.