Tesla (NASDAQ: TSLA) stock rallied on Friday, climbing as much as 4.5% in early trading, as investors looked for signs of easing tensions between CEO Elon Musk and former President Donald Trump. The bounce comes after a brutal Thursday that saw Tesla shares tumble over 14%, wiping out more than $150 billion in market value — the largest single-day loss in the company’s history.
The selloff followed a public and highly charged feud between Musk and Trump, two former allies now openly trading barbs across their respective social media platforms. The clash began after Musk criticized a new piece of legislation, dubbed the “big, beautiful bill” by Trump, that is currently moving through Congress. The Tesla CEO’s sharp remarks prompted Trump to question their relationship and accuse Musk of disloyalty.
The dispute escalated dramatically when Musk, posting on his platform X (formerly Twitter), voiced support for Trump’s impeachment and claimed the former president “is in the Epstein files,” referencing disgraced financier and convicted sex offender Jeffrey Epstein. Trump responded with a scathing message on Truth Social, calling Musk “crazy” and threatening to terminate federal contracts with Musk-owned companies, including Tesla and SpaceX.
Markets recoiled in response to the political drama, fearing real consequences for Tesla’s future government partnerships and its stock price. Investors were particularly alarmed by Musk’s threat — seemingly directed at Trump — to pull SpaceX’s Dragon spacecraft from missions that support NASA operations. That threat, however, appeared to be walked back late Thursday, a move seen as Musk trying to de-escalate the standoff.
While Friday’s rebound in Tesla stock may offer some short-term relief, the longer-term impact of this very public feud remains uncertain. Analysts caution that Tesla’s heavy reliance on government subsidies, contracts, and regulatory credits means political fallout could still cast a shadow over the company’s financial outlook.
For now, though, markets seem to be hoping that cooler heads will prevail. Investors will be watching closely for any further statements from either Musk or Trump — and for signs that this high-stakes drama may finally be heading toward a ceasefire.
