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Trump and Elon Musk Feud Deepens Over Tax Bill, Government Contracts at Risk
Tensions escalate as Trump cuts ties with Elon Musk over tax bill feud. Musk threatens SpaceX contract pullback, then backtracks. Market volatility follows.
ND
by News Desk
2025-06-06
Trump and Elon Musk Feud Deepens Over Tax Bill, Government Contracts at Risk

The public fallout between former US President Donald Trump and Tesla and SpaceX CEO Elon Musk intensified this week, putting billions in government contracts at risk and raising questions about the future of key US space programs.

The feud erupted over Trump’s sweeping tax-cut and spending bill, which Musk harshly criticized as a “disgusting abomination” that would balloon the national debt. Trump retaliated by threatening to terminate lucrative government subsidies and contracts awarded to Musk’s companies, including SpaceX, a critical partner in NASA’s space missions.

A White House official later clarified that no phone call was scheduled between Trump and Musk, despite earlier reports that a conversation was planned. The two leaders exchanged barbs on social media platforms—Trump on Truth Social and Musk on X—fueling uncertainty among investors and government officials.

Tesla shares reacted swiftly to the news, surging up to five percent in pre-market trading after falling 14 percent the previous day in the largest single-day decline in company history. Tesla’s market capitalization has dropped nearly 30 percent so far this year amid concerns about Musk’s political involvement.

In a surprising move, Musk announced plans to begin “decommissioning” SpaceX’s Dragon spacecraft, the only US vessel capable of ferrying astronauts to the International Space Station. Hours later, he softened his stance, saying he would hold off on the decision following advice to “cool off.”

The potential loss of SpaceX contracts, reportedly valued at $22 billion, could have severe consequences for NASA and the US space program, though the agency has declined to comment directly.

Despite tensions in the US, the European Commission welcomed Musk and his businesses to Europe, signaling openness to attracting his ventures to the continent.

The feud highlights the fragile alliance between two powerful figures whose political influence could shape future elections. Musk, a major donor to Republican campaigns, has threatened to reduce his political spending, potentially impacting GOP prospects in upcoming midterms.

As the dispute unfolds, industry watchers are closely monitoring the implications for government contracts, space exploration, and the intersection of tech and politics in the US.

 
Tagged:

SpaceX

tesla

USPolitics

TrumpVsMusk

TaxBill
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