Tesla shares tumbled by more than 14 percent on Thursday, June 5, wiping $150 billion off the companys market value, following a public clash between CEO Elon Musk and US President Donald Trump that rattled investors and raised concerns about potential government reprisals. The dispute erupted after a disagreement over the Presidents budget bill led to a heated exchange between the two influential figures. On his social platform, Truth Social, Trump threatened to cancel federal and state subsidies and contracts awarded to Musks companies, claiming it would be an easy way to cut costs. The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts, Trump posted. I was always surprised that Biden didn’t do it! Tesla currently benefits from billions in US government support, including a $7,500 tax credit for electric vehicle purchases. The threat of termination sparked immediate concern on Wall Street, with analysts warning that the rift could jeopardize Teslas future growth. The quickly deteriorating friendship and now major beef between Musk and Trump is jaw dropping and a shock to the market, analysts at Wedbush said in a note to investors. This situation must start to be calmed down its not good for either side. Despite the market jitters, Wedbush maintained a bullish long-term outlook on Tesla, citing confidence in its autonomous driving initiatives. However, analysts acknowledged that the feud has introduced new uncertainty around regulatory stability. Musks proximity to the White House has played a central role in Teslas recent trajectory. The carmakers shares soared more than 60 percent between Trumps election in November and the end of 2024. But backlash over Musks advisory role and the so-called DOGE department prompted investor concern and public protests, leading to Musk stepping back from the position. Tesla has also faced headwinds in its core business, with disappointing sales figures and brand damage continuing to weigh on sentiment. Yet the promise of AI and automation, particularly a driverless robotaxi pilot set to begin in Austin, Texas, has kept investors hopeful. Investing in Tesla isnt for the faint of heart, said Matt Britzman, senior equity analyst at Hargreaves Lansdown. Musks enthusiasm is both a blessing and, at times, a curse but with such a pivotal few months ahead for the autonomous strategy, investors will want to see Musk give his full attention back to Tesla. Richard Hunter, head of markets at Interactive Investor, added that the dispute has broader implications, pointing to growing unease around Trumps leadership style. The latest feud has heightened unease that the Presidents seemingly irascible and erratic behaviour is symptomatic of the environment which has been created on a global scale, Hunter said. Consumer sentiment is brittle given the wider context of what could be a weakening outlook.The post Tesla shares take $150bn plunge following Musk-Trump feud appeared first on Linda Ikeji Blog.Tesla shares take $150bn plunge following Musk-Trump feud
Tesla shares tumbled by more than 14 percent on Thursday, June 5, wiping $150 billion off the companys market value, following a public clash between CEO Elon Musk and US President Donald Trump that rattled investors and raised concerns about potential government reprisals. The dispute erupted after a disagreement over the Presidents budget bill led to a heated exchange between the two influential figures. On his social platform, Truth Social, Trump threatened to cancel federal and state subsidies and contracts awarded to Musks companies, claiming it would be an easy way to cut costs. The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts, Trump posted. I was always surprised that Biden didn’t do it! Tesla currently benefits from billions in US government support, including a $7,500 tax credit for electric vehicle purchases. The threat of termination sparked immediate concern on Wall Street, with analysts warning that the rift could jeopardize Teslas future growth. The quickly deteriorating friendship and now major beef between Musk and Trump is jaw dropping and a shock to the market, analysts at Wedbush said in a note to investors. This situation must start to be calmed down its not good for either side. Despite the market jitters, Wedbush maintained a bullish long-term outlook on Tesla, citing confidence in its autonomous driving initiatives. However, analysts acknowledged that the feud has introduced new uncertainty around regulatory stability. Musks proximity to the White House has played a central role in Teslas recent trajectory. The carmakers shares soared more than 60 percent between Trumps election in November and the end of 2024. But backlash over Musks advisory role and the so-called DOGE department prompted investor concern and public protests, leading to Musk stepping back from the position. Tesla has also faced headwinds in its core business, with disappointing sales figures and brand damage continuing to weigh on sentiment. Yet the promise of AI and automation, particularly a driverless robotaxi pilot set to begin in Austin, Texas, has kept investors hopeful. Investing in Tesla isnt for the faint of heart, said Matt Britzman, senior equity analyst at Hargreaves Lansdown. Musks enthusiasm is both a blessing and, at times, a curse but with such a pivotal few months ahead for the autonomous strategy, investors will want to see Musk give his full attention back to Tesla. Richard Hunter, head of markets at Interactive Investor, added that the dispute has broader implications, pointing to growing unease around Trumps leadership style. The latest feud has heightened unease that the Presidents seemingly irascible and erratic behaviour is symptomatic of the environment which has been created on a global scale, Hunter said. Consumer sentiment is brittle given the wider context of what could be a weakening outlook.The post Tesla shares take $150bn plunge following Musk-Trump feud appeared first on Linda Ikeji Blog.
