A growing rift between U.S. President Donald Trump and Tesla CEO Elon Musk has sparked concerns for the electric vehicle (EV) industry, as the two clash over a tax-cut bill that could reshape federal spending and EV market dynamics. According to a Reuters report, Trump has publicly distanced himself from Musk, signaling a potential end to their once-close alliance that could impact Tesla’s operations and the broader EV sector.

White House Cancels Trump-Musk Call Amid Tensions

An anonymous White House official confirmed that there was no phone call between Trump and Musk was planned, stating, “U.S. President Donald Trump is not interested in talking with Elon Musk.” This development follows a heated public dispute over a tax-cut and spending bill, which narrowly passed the House last month and is now under Senate review.

Nonpartisan analysts estimate the bill will add $2.4 trillion to the national debt over the next decade, a figure Musk has criticized as unsustainable. Musk, who recently stepped down as head of the Department of Government Efficiency (DOGE), denounced the package as a “disgusting abomination” that would balloon the nation’s $36.2 trillion debt.

Musk’s Opposition to Tax Cuts Rattles Tesla’s Market Position

Musk’s vocal opposition has had tangible effects on Tesla. After he left his DOGE role last week, Tesla shares dropped 14% on Thursday, losing $150 billion in market value—the largest single-day decline in the company’s history. Shares rebounded slightly on Friday, but the volatility underscores investor concerns about Musk’s divided attention.

His involvement with the Trump administration has already driven protests at Tesla sites, contributing to declining sales as some investors worry about the CEO’s focus.

Adding to the tension, Trump expressed frustration, stating on CNN, “I’m not even thinking about Elon. He’s got a problem, the poor guy’s got a problem.”

Trump also threatened to cancel government contracts with Musk’s businesses, including Tesla’s electric cars showcased on the White House lawn in March.

Trump-Musk Feud Escalates Over Tax-Cut Bill, Threatens Tesla And Ev Industry Stability

Potential Fallout for EV Industry and Federal Support

The feud could have broader implications for the EV industry, which relies heavily on federal incentives and contracts. Trump’s suggestion to terminate government deals with Musk’s companies, such as Tesla and SpaceX, could disrupt EV adoption programs. For instance, Tesla’s Model S, which Trump purchased in March, might be removed from federal use, signaling a shift away from EV support.

Additionally, Musk’s push to cut $2 trillion from the federal budget—far more than the 19% he achieved at DOGE—clashes with Trump’s domestic priorities, potentially stalling EV infrastructure investments like charging networks. Musk’s recent X post, saying “Yes” to a claim that Trump should be impeached over import tariffs, further escalates the conflict, though impeachment remains unlikely given Republican control of Congress.

SpaceX’s Role in U.S. Space Program Hangs in the Balance

Beyond EVs, the dispute threatens Musk’s SpaceX, a key player in the U.S. space program. Trump’s threat to cancel SpaceX contracts could impact the Dragon spacecraft, the only U.S. vehicle currently capable of sending astronauts to the International Space Station.

Musk later softened his stance, writing on X, “You’re not wrong,” in response to investor Bill Ackman’s call for peace between the two. However, a prolonged feud could hinder SpaceX’s operations, affecting U.S. space exploration goals and the EV industry’s momentum. As Tesla navigates market turbulence and the industry faces potential policy shifts, stakeholders are left wondering how this high-stakes clash will resolve—and what it means for the future of electric mobility in the U.S.

Photo courtesy of M. Pesce / Wikimedia / X