In a surprising turn of events, President Donald Trump publicly expressed support for Elon Musk’s Tesla on social media Thursday morning, despite the ongoing tensions between the two.
“I want Elon, and all businesses within our country, to THRIVE,” Trump wrote on Truth Social, signaling a sharp contrast to their previously bitter public feud.
However, Trump’s message did little to buoy Tesla’s stock, which saw a significant drop after the electric vehicle maker posted lackluster financial results for the April-June quarter. Tesla reported a 12% decline in revenue and a 16% drop in profit, with Musk warning investors of more “rough quarters” ahead.
The news sent Tesla’s stock down 8.2%, bringing its total loss for the year to over 24%. Many factors have contributed to the company’s financial struggles, including increased competition in key markets like Europe and China, and a growing number of potential buyers deterred by Musk’s controversial right-wing political stance.
Musk’s recent public disagreements with Trump, especially regarding government contracts and subsidies, have raised concerns among investors. Trump had previously threatened to cut government support for Musk’s ventures, including Tesla, if tensions continued.
However, Thursday morning, Trump sought to alleviate these fears by offering an olive branch to the billionaire entrepreneur.
“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 US Government. This is not so!” Trump wrote. “The better they do, the better the USA does, and that’s good for all of us.”
Tesla, however, faces some challenging financial realities. The company stands to lose the $7,500 electric vehicle tax credit following Trump’s recent budget bill, and its revenue from selling regulatory credits to other automakers is set to shrink as well. Additionally, the company has indicated that Trump’s tariffs on countries like China and Mexico could cost Tesla hundreds of millions of dollars.
Musk has been outspoken about his opposition to the budget bill, which he labeled a “disgusting abomination” on his social media platform X. He also hinted at the possibility of creating a new political party in response to his frustrations with the current political landscape.
On Tesla’s earnings call Wednesday, Musk acknowledged that the company could face a tough period ahead as it transitions from selling cars to focusing more on offering self-driving car services and humanoid robotics. Tesla recently launched its paid robotaxi service in Austin, Texas, and plans to expand it to other cities. Musk has expressed optimism about the long-term prospects of these new business ventures but admitted that they are still in the early stages.
“We’re in this weird transition period where we’ll lose a lot of incentives in the US,” Musk said, acknowledging that the company may face “a few rough quarters” in the near future. However, he remained confident about Tesla’s prospects in the second half of next year. “Once you get to autonomy at scale in the second half of next year, certainly by the end of next year, I would be surprised if Tesla’s economics are not very compelling,” he concluded.