Tesla Inc. TSLA stock traded down 14.3% to $284.70 on Thursday, the company's second-biggest percentage loss in more than a year and the biggest market cap loss in company history. The decline was caused by an escalated feud between CEO Elon Musk and President Donald Trump.
What Happened: Tesla's market cap fell by a company record $152 billion, taking the company out of the $1 trillion market capitalization club. This move comes after Musk publicly criticized Trump's "Big Beautiful Bill."
Comments made by Trump in a press interview and by Musk and Trump on social media accounts escalated the battle, with people picking sides in a war of words between two of the world’s most influential voices.
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Musk has been vocal about the projected increase in the national debt from the new spending bill.
"Congress is spending America into bankruptcy!" the Tesla CEO tweeted.
Trump posted a series of messages on his Truth Social account speaking out against Musk.
"I don't mind Elon turning against me, but he should have done so months ago. This is one of the Greatest Bills ever presented to Congress," Trump posted.
The president said the bill will put the country "on a path of greatness."
Another post had Trump saying that he asked Musk to leave the White House as he was "wearing thin." The president said he removed Musk's EV mandate, which "forced everyone to buy electric cars that nobody else wanted."
"And he just went CRAZY!"
Trump also suggested that terminating government subsidies and contracts with Musk would be one way to save money.
Musk said the president’s comments on the EV mandate are "an obvious lie" in a tweet. The Tesla and SpaceX CEO also suggested that he will decommission the Dragon spacecraft in response to Trump's threat on subsidies. The Dragon spacecraft was recently used to bring two stranded astronauts home from the International Space Station.
Musk also asked if it was time to create a new political party in America that represents the "80% in the middle." With over 1.1 million votes in, 82% had voted yes, suggesting a third-party option to the Democratic and Republican parties.
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Escalating the feud further, Musk tweeted that the "really big bomb" is that Trump is in the Epstein files, a reference to the list of people associated with convicted sex offender Jeffrey Epstein.
"This is an unfortunate episode from Elon, who is unhappy with the One Big Beautiful Bill because it does not include the policies he wanted. The President is focused on passing this historic piece of legislation and making our country great again, " said White House Press Secretary Karoline Leavitt when asked by Benzinga for comment.
Musk also suggested that Trump's tariffs "will cause a recession in the second half" of 2025.
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Tesla Stock Falls: Shares of the electric vehicle company suffered their second-largest fall year-to-date on Thursday, narrowly beaten by a 15.4% drop on March 10.
That March 10 drop was the largest percentage loss for Tesla shares in five years. The drop came as Musk's role in the White House expanded, and he said he planned to stay involved for another year. The stock had dropped in several sessions around that time amid tariff fears and concerns that Musk's political activism was damaging the Tesla brand.
While this marks Tesla’s largest market cap drop, it is also shy of the largest percentage drop in 2025 and all time.
The largest single-day percentage drop for Tesla stock was on Sept. 8, 2020, when it fell 21.1% after not being selected as a member of the S&P 500 Index. The stock would later be added to the index.
Tesla stock fell 19.3% on Jan. 13, 2012 after two key departures were announced, as reported by CNN.
The good news for Tesla stock could be its history of rebounds after big drops. After shares fell 15.4% on March 10, 2025, the stock rose 3.8% the following day. After the record 21.1% drop on September 8, 2020, Tesla stock rose 10.9% the next day.
Tesla stock has traded between $167.42 and $488.54 over the last year, and it is now down 24.9% year-to-date in 2025.
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