The spat between US President Donald Trump, Elon Musk and Tesla intensified Thursday when Trump proposed cutting federal contracts and subsidies to Musk’s Tesla and SpaceX companies.
Musk’s harsh criticism of the Republican tax plan prompted a sharp retort by President Trump.
Cutting federal contracts
Trump wrote in an account on Truth Social, “The easiest and most cost-effective way to reduce our budget, Billions, Billions, Billions, Dollars is to cancel Elon’s Governmental Subsidies, and Contracts.” “I was surprised Biden never did it!”
Musk responded by writing in a post on social media, “Go right ahead and make my day”.
Tesla’s CEO claimed that Trump’s names appeared in Epstein documents.
Musk was making reference to files relating to Jeffrey Epstein, a late New York financier who had been accused of trafficking in underage girls.
Epstein died later by suicide, while incarcerated in a federal jail.
Musk’s Tesla receives subsidies for electric vehicles from the federal Government. SpaceX is also contracted by NASA and the Pentagon.
SpaceX has secured federal contracts worth $3.8 billion for the fiscal year 2024.
Tax credits of up to 7,500 dollars are available for certain Tesla models.
In 2025, the new tax bill will eliminate the $7.500 Tesla tax credit, which is seven years earlier than scheduled.
JP Morgan analysts estimate that this will cause Tesla to lose $1.2 billion in profits for the full year.
Bloomberg Government data shows that the revenue generated by SpaceX and Tesla since 2000 from unclassified federal contracts is $22.5 billion.
Social media feuds are ugly
Musk began the public dispute between Trump and Musk by criticising Trump’s “big beautiful bill”.
The richest man in the world said that the new tax law would increase the federal deficit, undoing all of the hard work of the Department of Government Efficiency.
Musk was the one who told Trump that his criticisms of the Tax Bill were disappointing. Musk said he knew more about the “inner workings” of the bill then anyone else present.
Musk, according to Trump had no objections with the bill but only became opposed after learning about the mandated EV tax cuts.
Musk replied to this claim via an X post (formerly known by the name Twitter).
Musk replied: “This bill has never been shown to me, and it was passed so quickly in the middle of the night that no one could read it!”
Musk said, “Such ingratitude”, and that without his help Republicans and Trump could have lost 2024’s election. Democrats would now control the House and Republicans the Senate.
Musk, in a X-poll, asked about the creation of a political party “representing the 80% on the middle”.
Musk denied that he was against the EV mandate tax cut. He added, “ditch the MOUNTAIN OF DISGUSTING POULK in the bill.”
Last week, the CEO of Space X and Tesla left the Federal Government. He had been at DOGE for four months.
Tesla’s shares fell 14% following a spat between former allies.
The ICD published the following post: Trump says Musk should lose federal contracts and subsidies due to public spat.
