Tesla stock tumbled Tuesday as founder Elon Musk continues to feud with President Trump over the pending GOP spending package.
Republicans have proposed a series of rollbacks in the bill, including a strike to electric vehicle (EV) credits, which could roil Tesla’s profits.
The company’s stock dropped by almost 6 percent in early trading Tuesday, according to The Associated Press.
Wedbush Securities analyst Dan Ives said Tuesday that investors fear the Trump administration will become “more hawkish” toward the company and scrutinize federal contracts with Tesla, according to the AP.
“We would expect the stock to be weak to kick off trading this morning as the Street will show concern that the Trump and Musk once BFF relationship now backfires and turns into a junior high school friendship gone bad into an enemy,” he wrote.
The dip follows a fluctuating trend for the electric vehicle manufacturer over the past few months as Musk pegged his stake in Washington’s political landscape and after the tech billionaire fell out with Trump.
The former White House adviser has encouraged lawmakers not to pass the spending legislation in its current form and vowed vengeance against those who refuse to change course, citing its impact on the national debt.
“What’s the point of a debt ceiling if we keep raising it?” Musk wrote in a Monday post on his social platform X.
“Hitting the debt ceiling is the only thing that will actually force the government to cut waste and fraud. That’s why the debt ceiling legislation exists!” he added in an earlier post.
The tech giant previously led the White House’s Department of Government Efficiency (DOGE), dedicated to curtailing government spending in addition to exposing waste, fraud and abuse.
Musk claims to have spurred massive reductions through the slashing of federal programs and contracts while alleging the Trump-backed megabill in Congress would hamper DOGE’s impact.
But Trump pushed back Tuesday, urging Musk to quiet down or face retaliation from the entity he once led in addition to losing EV subsidies.
“We might have to put DOGE on Elon. You know what DOGE is? DOGE is the monster that might have to go back and eat Elon. Wouldn’t that be terrible? He gets a lot of subsidies,” the president told reporters on the White House South Lawn.
