Tesla stock price tumbles as the Big Beautiful Bill reignites public feud between Elon Musk and Donald Trump

Shares of Tesla are down in premarket trading today after President Donald Trump and the EV maker’s CEO, Elon Musk, traded barbs on their social media platforms, reigniting a public feud that had boiled over early last month only to die down in more recent weeks.

At the center of the feud is Trump’s controversial legislative darling, the One Big Beautiful Bill Act, which is currently making its way through Congress. Here’s what you need to know about the latest Trump-Musk blowup and its impact on Tesla stock.

What’s happened?

Donald Trump and Elon Musk are at each other’s throats again. This latest dustup comes almost a month after the two men had a very explosive and very public blowout on social media. In early June, the inciting incident for the Trump-Musk feud was the president’s signature piece of legislation, the One Big Beautiful Bill Act.

And the current feud is about the same.

The One Big Beautiful Bill Act is widely seen as being good for the ultra-wealthy and bad for nearly everyone else. According to the Congressional Budget Office (CBO), the act provides $3.8 trillion in tax cuts for the wealthiest Americans. Those tax cuts will primarily be paid for by stripping access to Medicaid and other government healthcare and social services, costing up to 10.9 million Americans their healthcare coverage.

However, it’s other provisions in the bill that seem to irk Musk. The latest version of the bill cuts subsidies for electric vehicles and alternative energy, while giving subsidies to the coal industry, notes Reuters. The CBO also says the bill will add $3.3 trillion to the U.S. deficit over the next decade.

Musk, who led the controversial Department of Government Efficiency (DOGE) for President Trump in the first half of the year, is historically outspoken in his desire to cut government spending and reduce the U.S. deficit.

As the Senate began its vote-a-rama on the One Big Beautiful Bill Act yesterday, Musk went into overdrive, renewing his criticisms of the bill and making threats about the steps he would take next if the bill passes the Senate.

What did Musk say?

Musk started posting about the bill on X yesterday afternoon it was being addressed in the Senate chamber. In a post that kicked off the first of many, Musk said, “It is obvious with the insane spending of this bill, which increases the debt ceiling by a record FIVE TRILLION DOLLARS that we live in a one-party country – the PORKY PIG PARTY!!”

That post went on to proclaim that it was “Time for a new political party that actually cares about the people.”

Less than an hour later, Musk escalated his rhetoric against the bill, issuing threats against congressional Republicans who vote for it.

“Every member of Congress who campaigned on reducing government spending and then immediately voted for the biggest debt increase in history should hang their head in shame!” Musk said. “And they will lose their primary next year if it is the last thing I do on this Earth.”

A few hours later, Musk issued another statement, in which he doubled down on his threat to form a new political party in America. 

“If this insane spending bill passes, the America Party will be formed the next day,” the Tesla CEO said. “Our country needs an alternative to the Democrat-Republican uniparty so that the people actually have a VOICE.”

Musk is one of the few people in the country whose threats to start a new political party and “primary” Republicans who support the bill hold weight. That’s because Musk is the richest individual in the world, and he has the financial resources to back challengers to politicians he disagrees with. Conceivably, Musk’s wealth could also be leveraged to launch a new political party.

In the United States, both Democrats and Republicans worry about the possibility that a third party may one day gain popularity. Even if such a hypothetical party struggled to garner the majority of votes needed to become dominant, it could at the very least divert votes from both existing parties, which could ultimately benefit their main opposition. 

How did Trump react?

Not well. After Musk’s flurry of tweets threatening to help oust Republicans who support the One Big Beautiful Bill Act and to form a new party, the president lashed out at Musk on his social media platform, Truth Social, and made threats of his own.

In his post on Truth Social, the president focused on the loss of subsidies for EV makers in the bill, suggesting that is why Musk is actually upset about the One Big Beautiful Bill Act.

“Elon may get more subsidy than any human being in history, by far,” the president said, “and without subsidies, Elon would probably have to close up shop and head back home to South Africa. No more Rocket launches, Satellites, or Electric Car Production, and our Country would save a FORTUNE.”

But Trump didn’t stop there. The president then went on to suggest that perhaps a DOGE investigation into Musk’s subsidies was needed.

“Perhaps we should have DOGE take a good, hard, look at this?” The president wrote. “BIG MONEY TO BE SAVED!!!”

After Trump’s comments, shares in Elon Musk’s electric vehicle company, Tesla, Inc. (Nasdaq: TSLA), are currently falling in premarket trading this morning.

Why is TSLA stock falling?

Because as president of the United States, Trump could cause a lot of trouble for Elon Musk’s electric car company. He could do this through regulatory hurdles via the Department of Transportation, notes Reuters.

For example, the agency could delay or even deny the approval of Tesla’s Robotaxi expansion.

Of course, Trump could also reduce the profits of Musk’s other companies, including the privately held SpaceX, by denying future government contracts.

Whether any of this will actually happen remains to be seen. But this latest spat between Trump and Musk underscores their propensity to air their grievances in public, and that appears to be worrying Tesla investors.

As of the time of this writing, TSLA shares are currently down nearly 5% in premarket trading to around $302 per share. The stock is down more than 16% year to date.