Tesla (TSLA) Plunges after Trump Threatens Elon Musk’s Companies

The conflict between President Donald Trump and Tesla (TSLA) CEO Elon Musk escalated on Thursday after Trump criticized Musk and threatened to cut off his government contracts. Musk has strongly opposed Trump’s new budget bill, warning that it would add trillions to the national debt. Trump responded on social media, saying, “I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!” After Trump’s comments, Tesla’s already-falling stock dropped even more and finished more than 14% lower.

What is interesting is that just days ago, Trump and Musk were on good terms, even complimenting each other during a White House event that marked the end of Musk’s role as head of the Department of Government Efficiency. But in a Truth Social post Thursday, Trump said that Musk was “wearing thin” by the end of his time as a “special government employee” and added, “I asked him to leave.”

In another Truth Social post, Trump threatened to cut federal support for Musk’s businesses, “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it!” Nevertheless, Musk, who also leads SpaceX, Neuralink, xAI, The Boring Company, and owns the social media platform X, continues to push Senate Republicans to vote against the bill, which he believes would do more harm than good.

What Is the Prediction for Tesla Stock?

Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 16 Buys, 10 Holds, and 11 Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $282.70 per share implies 0.7% downside risk.

See more TSLA analyst ratings