President Donald Trump moved Thursday to tamp down speculation that he intends to punish Elon Musk by revoking government subsidies, saying he wants the tech mogul’s companies to “thrive.” The remarks come amid an escalating feud between the former allies, following Musk’s public criticism of Trump’s sweeping tax bill and the launch of his own political party. “Everyone is stating that I will destroy Elon’s companies by taking away some, if not all, of the large scale subsidies he receives from the U.S. Government. This is not so!” Trump wrote in a social media post.
Musk quickly fired back on X, arguing that his companies—particularly SpaceX—do not rely on government subsidies, but rather win contracts competitively. “SpaceX won the NASA contracts by doing a better job for less money,” Musk wrote, adding that shifting those contracts to other firms would be costly and dangerous. The clash intensified just a day after Musk warned Tesla investors that looming federal policy changes could lead to “a few rough quarters,” as tax credits for electric vehicles are set to expire on September 30 under new legislation signed by Trump.
Once close allies, Musk and Trump have publicly soured since the Tesla CEO stepped down from the administration in May. Musk had poured over $250 million into Trump’s reelection efforts and spearheaded efforts to shrink the federal government. But after denouncing Trump’s tax-and-spending package, tensions flared, with the White House reportedly ordering reviews of SpaceX contracts and exploring alternative partners for the $175-billion Golden Dome missile defense program. Despite this, SpaceX remains a leading candidate for major defense initiatives—though its position may be slipping as the political fallout continues.
