The clash between the world’s richest man and one of its most influential political figures could cost Elon Musk billions, with major implications for his companies Tesla, SpaceX, Starlink, and social media platform X.

The growing feud with Donald Trump could lead to heightened regulatory scrutiny on Tesla’s self-driving ambitions, reduced NASA contracts for SpaceX, fewer international Starlink deals, and a renewed exodus of advertisers from X. While the final impact depends on how far Trump takes the dispute, analysts warn that Musk is especially vulnerable due to his companies’ heavy reliance on government support.

Auto industry expert Sam Abuelsamid commented wryly, “Trump doesn’t have a history of retaliating against rivals, so maybe this just blows over.” But he quickly shifted tone, pointing out that Musk's empire “depends heavily on government support,” leaving it exposed.

Although both sides could suffer in a prolonged standoff, Musk appears to have more at stake.

Tesla’s Robotaxi Rollout at Risk

The fallout comes just ahead of Tesla's much-anticipated autonomous taxi test in Austin, Texas — a critical move as electric vehicle sales slow in many markets. Trump could influence federal regulators to intensify oversight just as Tesla needs momentum.

Even prior to Thursday’s public spat, the National Highway Traffic Safety Administration (NHTSA) requested data on how Tesla’s self-driving technology performs in low-visibility conditions. This followed a probe into 2.4 million vehicles with Tesla’s Full Self-Driving software after incidents including a pedestrian fatality. NHTSA confirmed the investigation is ongoing and reaffirmed its commitment to road safety.

Meanwhile, the Department of Justice is also examining Tesla vehicle safety, though it has not provided recent updates.

Investor enthusiasm around Tesla’s robotaxis had lifted the stock by 50% in recent weeks, but the feud with Trump triggered a 14% drop on Thursday. Shares rebounded 4% on Friday.

“Tesla’s rally was largely driven by excitement over robotaxis,” said Morningstar analyst Seth Goldstein. “This Trump-Musk conflict could put a damper on that.”

Carbon Credit Sales in Jeopardy

Tesla’s lucrative carbon credit business is another area at risk. While often overlooked, this revenue stream surged 33% to $595 million in Q1 — despite falling overall earnings.

However, as Musk and Trump exchanged barbs on Thursday, Republican lawmakers added provisions to Trump’s proposed budget to remove fines for fuel-inefficient cars. That change could reduce demand for Tesla’s regulatory credits, which are sold to automakers needing to meet emissions standards.

Although Musk has minimized the credits' importance, any reduction would still hurt, especially amid ongoing Tesla boycotts tied to his past alignment with Trump.

Potential for Sales Revival — or More Trouble

Musk’s political leanings have alienated environmentally conscious consumers, contributing to Tesla’s sales challenges. If his break with Trump is perceived as genuine, some buyers may return — though this remains uncertain.

Previously, analysts speculated Tesla could grow its market in conservative “red” counties, but sentiment has since shifted.

“There’s more uncertainty than clarity after Thursday,” said TD Cowen analyst Itay Michaeli, who recently lowered his Tesla price target from $388 to $330. The stock closed Friday at $300.

Tesla has not issued a statement on the situation.

SpaceX and NASA: A High-Stakes Standoff

Trump’s threat to slash government funding for SpaceX is especially significant. The $350 billion private company, central to NASA’s space missions, could be impacted if contracts are cut.

SpaceX currently operates the only U.S. spacecraft — the Dragon capsule — capable of sending astronauts to and from the International Space Station. Losing this capability would leave NASA with a politically difficult fallback: relying on Russia’s Soyuz capsules.

Musk responded provocatively, suggesting SpaceX might decommission Dragon, though he later appeared to walk back the comment in a follow-up post on X.

Starlink’s Global Business in the Spotlight

Starlink, SpaceX’s satellite internet division, may also face repercussions. Its recent wins — including service approvals in Saudi Arabia, Bangladesh, Pakistan, India, and other countries — may have benefited from Musk’s previously close relationship with Trump.

India, where 40% of the population lacks internet access, approved a major Starlink license on Friday. Whether politics played a role in these deals remains unclear.

Ad Recovery on X Could Stall

X, the platform formerly known as Twitter, has seen advertisers slowly return after initially fleeing due to Musk’s tolerance for conspiracy content. Some of that recovery may have been driven by concerns over alienating conservative audiences.

Musk has labeled the advertiser pullout an “illegal boycott” and sued several companies. The Trump administration even launched a Federal Trade Commission probe into possible coordination.

Now, if Trump distances himself from Musk, it could make X a liability again for brands.

“There’s a real risk that X could become toxic again for advertisers,” said Cornell political scientist Sarah Kreps. “But a mass exit isn’t guaranteed — it all depends on how serious and prolonged the conflict becomes.”

Source: With inputs from news agency