Elon Musk’s Tension Amid Trump Bill as Congress Wants to Cut EV Vehicles
In June 2025, President Donald Trump and tech titan Elon Musk suddenly clashed in the headlines, sparked by the controversial passage of the “One Big Beautiful Bill” (OBBB). The bill proposed drastic changes, including a provision that sought to eliminate federal incentives for electric vehicles (EVs), which directly affected Musk’s companies, Tesla and SpaceX.
This dispute highlights the ongoing tension between business interests and government policy and sets the stage for potential challenges for the future of electric vehicles in the United States.
What is the One Big Beautiful Bill (OBBB)?
The “One Big Beautiful Bill” was passed by the U.S. House of Representatives on May 22, 2025. It included various provisions aimed at reducing federal spending and raising funds through tax increases. One of the most controversial aspects of the bill was the removal of the $7,500 federal tax credit for electric vehicles.
This move directly impacted the EV industry, notably Tesla, which has relied heavily on these incentives to drive sales. The bill also sought to discontinue regulatory credits, which had been a significant revenue stream for Tesla.
The Congressional Budget Office estimated that the bill would add approximately $2.4 trillion to the national debt, raising concerns about its long-term impact on the economy and public services.
Elon Musk’s Strong Opposition to the Trump Bill
Elon Musk, the CEO of Tesla and SpaceX, strongly disapproves of the OBBB. In a series of public statements, Musk referred to the bill as a “disgusting abomination” and expressed concern that it would reverse progress made in the shift toward clean energy. He argued that the elimination of federal EV incentives would significantly hinder the adoption of electric vehicles, which he views as essential for reducing global carbon emissions.
Musk’s criticism was particularly pointed, given his previous support for many of Trump’s policies, especially those that favoured the business community. Musk had been a vocal advocate for tax policies that benefited companies like Tesla, and his support for clean energy aligned with some of Trump’s earlier initiatives. The sudden shift in his position, opposing the president’s bill, raised eyebrows and marked a significant turning point in their relationship.
Trump’s Response to Musk’s Criticism
In response to the criticism from Elon Musk, Donald Trump turned to social media and public forums to express his frustration. He suggested that Musk’s opposition was based on the removal of the EV mandate, which had granted Tesla and other electric vehicle manufacturers substantial government subsidies.
Trump’s response was not just rhetorical; he hinted at potential retaliatory actions, including cutting off federal contracts with Musk’s companies.
SpaceX, which has received significant government funding for its space missions, was particularly at risk. These contracts, which have been a substantial source of revenue for SpaceX, could be jeopardized if Trump followed through with his threats.
The Financial Impact on Tesla and SpaceX
The fallout from the Trump-Musk feud had immediate financial consequences. Tesla’s stock price saw a sharp decline, falling by 14% in a single day after the bill passed. Investors expressed concerns over the potential loss of government incentives for EV buyers and the long-term viability of the EV market without federal support.
These contracts, which fund a significant portion of SpaceX’s operations, could be at risk if Musk’s relationship with the Trump administration continues to sour.
The situation increased scrutiny of both of Musk’s companies, with analysts speculating about the long-term effects on their profitability and growth.
Political Fallout from the Dispute
Beyond the immediate business implications, the public dispute between Musk and Trump had broader political ramifications. The tension underscored the complex relationship between the private sector and government, particularly when policy decisions impact industries that rely heavily on government support.
Musk’s criticism of the OBBB and his subsequent fallout with Trump drew attention to corporate leaders’ influence on public policy. It also highlighted the challenges faced by businesses operating in sectors heavily dependent on government subsidies and regulatory credits.
As private sector leaders like Musk take stances on policy matters, their influence over national decision-making processes becomes more pronounced.
The Future of EV Incentives in the U.S.
As the dispute continues to unfold, the future of electric vehicle incentives in the United States remains uncertain. The removal of the EV tax credit could discourage consumers from purchasing electric vehicles, especially considering the higher upfront costs associated with EVs. While some states may continue to offer their own incentives, the federal government’s withdrawal of support could create significant barriers for the EV industry.
The OBBB also signals a shift in U.S. policy toward energy and environmental issues. If the bill becomes law, it may mark the beginning of a more hands-off approach from the federal government regarding clean energy technologies.
This could have far-reaching implications for industries like Tesla, which have built their business models around promoting sustainable energy solutions.
Looking Ahead: Will Musk and Trump Reconcile?
The future of Elon Musk’s relationship with President Trump remains uncertain. While the two have clashed over the OBBB, it is possible that future political or business opportunities could bring them back together. Musk’s influence as a businessman and innovator cannot be understated, and his support for the clean energy movement is likely to continue, regardless of the outcome of this particular dispute.
For Musk, the challenge lies in navigating a rapidly changing political landscape while maintaining the momentum of his companies. Tesla and SpaceX must continue to innovate and adapt to shifting policies while also preparing for potential challenges to their business models.
In the coming months, it will be essential to observe how Musk and his companies respond to the evolving political climate and whether they can maintain their competitive edge without relying on federal support.