Tesla Stock Plummeted After Elon’s Feud With Trump. The Amount Reveals Something Important.

By Alex Kirshner

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June 06, 202512:44 PM

Photo illustration by Slate. Photos by Allison Robbert/AFP via Getty Images and Andrew Harnik/Getty Images 

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How much is it worth to have oligarchic control of the United States government?

Thanks to Elon Musk, we now have a ballparked answer: a bit more than $100 billion, or 14 percent of Tesla’s value. How did we arrive at an answer here? Well, in the first stock trading session after Donald Trump won the election last November, Tesla shares gained 14 percent, or about $110 billion. On Thursday, Elon Musk’s alliance with Donald Trump exploded in public view, and what happened to Tesla’s stock? It fell 14 percent. A company that was worth more than $1 trillion on Wednesday was worth a piddly $892 billion on Thursday.

It’s hard to be exact with these things. Tesla’s stock ran for weeks after Trump’s election, and it had been in a decline for months by the time Musk posted on Thursday about Trump being in the Epstein files. The stock was having a bounceback on Friday, and we’re not in the business of predicting future moves. But we now have a pretty good estimate of the corruption premium that investors were paying for Tesla’s stock in recent months: about a 14 percent markup, give or take, on what the stock would otherwise be worth.

Thursday cemented a new reality for Musk’s businesses, or at least made the truth harder to deny. For a few months, Musk’s public messaging indicated that he was backing away a bit from his domination of the federal government. Though he still posted plenty about electoral politics, his tweeting had started to focus more on his businesses. He gave a series of interviews in which he tried to sell a “back to business” narrative about how he was using his time. He seemed to have realized that the social stigmatization of Tesla ownership had become a drag on the stock price. No amount of White House photo ops or Justice Department intimidation of protesters was going to make more people want to buy Teslas. Nor were Musk’s conservative pals lining up to buy them. They’d already been polarized against electric cars.

Could Musk have rotated his reputation away from right-wing political kingpin and back toward “eccentric genius with a lucrative vision for the future of humanity”? Sure, maybe—our attention spans are very short. But that road closed on Thursday when the feud unfurled in public view. Musk and Trump might make up one day, or they might not. (I would guess not, given Musk’s insinuation that Trump is a pedophile, but hey, I hope the two of them can work through their issues.) But in this latest public spiraling-out, Musk significantly grew the number of people who either don’t trust him or will now have a sharply negative political association with him thanks to his breakup with Trump. Whatever chance existed of Musk returning to his days as a humble billionaire tilling his factories, free from political baggage, is gone. He is still dogged by the same problem: his pathological inability to stop posting.

Musk’s existing problems at the intersection of politics and business had already piled up. Left-of-center people are more likely to buy electric vehicles and more likely to vomit at the sight of Musk, a rough coincidence for Tesla. Musk’s influence with Trump had reportedly been on the wane, something that many people were skeptical about but that now seems undeniably true. Trump had nominated one of Musk’s business buddies to run NASA, in a boon for SpaceX, but pulled that nomination last week. (I don’t know that SpaceX needed a Musk friend in order to get NASA contracts, but it never hurts.)

A blowout with Trump solves none of those problems—but it could create much more significant new ones. Other than the Lockheed Martins of the world, there aren’t many companies with more to lose from a lockout from federal contracts than SpaceX. Trump mused Thursday about ending Musk’s contracts and subsidies, a move that would cost SpaceX at least several billion dollars a year, plus probably some more we don’t know about. Tesla, too, has its beak in the federal trough.

There’s been lots of coverage about Trump’s threats and less about whether he can actually do that, contracts being binding and all. Some of Musk’s work for the government is work that the government really could not do itself without many years of buildup, which presumably would offer some protection to SpaceX. But if there is one guy in the universe who has helped Trump establish the idea that federal funding can just be halted at a whim, it is Musk. If only there were some sort of reliable process for the delivery of such funds.

Along the same line, Steve Bannon believes Musk should be deported. Thankfully, the United States has protections for immigrants who are in the country legally, and Trump has a record of respecting them.

On one of the funnier days in recent internet history, some speculated that all of this has been a work: Perhaps Musk and Trump weren’t really falling out, but just trying to give Musk some space from the political heat that has harmed his businesses—sort of in the “See, he’s actually a bipartisan free thinker” way. If there’s any theater happening here, that would likely mean the Epstein allegation should actually suggest Trump wasn’t part of it at all. But it’s doubtful that Musk is playing games either. As it was put by the New York Times’ Kate Conger, who co-wrote a book about Musk’s buyout of Twitter: “I need you to remember we are not dealing with a 4-d chess guy, or a chess guy, or even a checkers guy.”

A more simple answer is right in front of you: Musk is a wildly rich conservative who does not understand the American legislative process and likes a chance to rail against “pork.” Musk may also be salty about the bill’s exclusion of tax credits to buy electric cars, or about the optics of a deficit-growing bill cutting against the possibly nonexistent deficit cutting he did with the Department of Government Efficiency. He is certainly mad that he hasn’t gotten proper deference for, in his own view, getting Trump elected. (Fun to realize that Musk is still claiming credit, in his own words, for putting a subject of the Epstein files in the White House.)

So what happens next? Musk had already made himself polarizing in business, but polarizing isn’t necessarily bad. In fact, for a time after Trump’s election, the stock market decided that Musk’s coziness with Trump was an excellent thing for Tesla. With that coziness gone but left-of-center disdain for Musk still there, and now probably joined by some backlash from Trump’s fans, where to now? What new frontiers of opposition to Musk and his companies might be available now that he is out of Trump’s good graces?

You could spitball a lot of ideas. Financial professionals could make a lot of money offering stock market index funds that exclude Tesla, but no one has done that yet. Would someone be more likely to offer such a product if they don’t think Trump, or his Securities and Exchange Commission, would hit back at them? Could Trump use his bully pulpit to prop up some other EV company? How about deepening the government’s relationship with OpenAI, run by Sam Altman, whom Musk hates? One can imagine the big guy getting creative, and if he does, it’s not clear who would come to Musk’s defense now. But one thing is clear: Musk hasn’t gotten out of politics. He’s only gotten himself deeper into it, and without the fun benefit of the most powerful person in the world wanting to do him favors.