President Donald Trump postponed growing speculations on Thursday that he plans to dismantle federal support for Elon Musk companies, in the middle of increasing tensions between the two high -level figures and the mounting challenges in Tesla.
In an article on Truth Social, Trump responded to the affirmations that he wants to dismantle the Musk commercial empire by removing government subsidies, calling such reports “not the case”.
“Everyone says that I will destroy Elon’s companies by removing some, if not all, of the large -scale subsidies that he receives from the US government,” wrote Trump. “This is not the case!” I want Elon, and all the companies in our country, thrive, in fact, thrive like never before!, The better they do, the better the United States is, and it’s good for all of us. ”
Register For TEKEDIA Mini-MBA Edition 18 (September 15 – December 6, 2025)) Today for early reductions. An annual for access to Blurara.com.
Tekedia Ai in Masterclass Business open registration.
Join Tekedia Capital Syndicate and co-INivest in large world startups.
Register For Tekedia ai lab: From technical design to deployment.
Confidence came in the middle of a deepening of the fallout between the president and the CEO of Tesla, triggered by the vocal opposition of Musk to the signature legislation of Trump – the “Big Beau Bill Act” (OBBBA) – and ignited by personal blows, including the reference of Musk to Trump’s bonds with the sexual offender Jeffrey Epein.
Once the Allies, Trump and Musk have turned into a bit of criticism of each other. Musk, who previously directed the so-called Ministry of Effectiveness of the Government and donated hundreds of millions of dollars to his re-election campaign, has become more and more critical of administration policies.
Their quarrel intensified in June when Trump threatened to withdraw federal contracts from Musk companies, saying that they “could be due to an exam”. The remark shaken investors and analysts who reported the high dependence of Musk companies – in particular SpaceX, Tesla and Xai – on the support of the United States government.
The move, which removes the incentive of $ 7,500 for electric vehicles from September 30, already reshapes the market, Tesla rushing to sell its inventory and its American car manufacturers contravening a second turbulent of the year.
Tesla said $ 439 million in regulatory credit sales for T2 2025, according to FEDSTCOUT, but these income decreases as more and more competitors enter the VE space and that federal and state incentives are becoming uncertain.
Since 2015, Tesla has won $ 12.24 billion by selling these credits, largely linked to environmental mandates which oblige manufacturers to sell a minimum number of zero emission vehicles or to buy credits to companies like Tesla. These credits were essential to the beneficiary margins of Tesla, because they are pure income without associated manufacturing cost.
On Wednesday, the company of electric vehicles warned that the expiration of Federal EV subsidies and the costs of tariff increasing the push to “a few difficult quarters”.
“Given the brutal change, we have a limited offer of vehicles in the United States this quarter,” said Tesla CFO Vaibhav Taneja. “If you are in the United States and you are looking to buy a car, place your order now because we may not be able to guarantee delivery orders placed in the last part of August and beyond.”
He comments during the call for results in the second quarter of Tesla on Wednesday, where the car manufacturer posted weaker than expected results and warned the pressure from future margins.
With the “OBBBA” legislation which eliminates or modify these subsidies, Tesla’s file warned that “the loss of tax credits and carbon compensation mechanisms may have a negative impact on our financial results”. The company has also noted that “the provisions of the OBBA could affect the expenses of battery cells and have an impact on the costs of our consumers, which has a negative impact on demand”.
In addition to this, Tesla’s gross margin has decreased due to aggressive price drops aimed at remaining competitive on a world market for overcrowded electric vehicles. Deliveries have not reached Wall Street expectations for the third consecutive quarter, and available cash flows slipped into a negative territory.
The benefits extend beyond Tesla. SpaceX has received more than $ 22 billion in government contracts since 2008, including work with NASA, Air Force and Space Force. The Trump administration would have launched an examination of these contracts, although the Wall Street Journal noted that most had been deemed “critical” and unlikely to be cut.
Meanwhile, the new artificial intelligence company of Musk, XAI, on July 14, the Pentagon awarded contracts of a value of up to $ 200 million to Xai and three other IA companies. But a few days later, the press secretary of the White House, Karoline Leavitt, suggested that the federal agencies could be discouraged from working with the startup of the Musk AI due to the growing friction of the administration.
For Tesla, the expiration of the federal advantages of the EV at the end of September, combined with the inflationary pressure of prices and the weakening of demand, raises serious questions on its growth trajectory. The company suggests that the worst could still expect, and analysts degrade expectations for 2025.
At the heart of all this is a formerly powerful alliance that has become toxic. Trump-Musk spinoffs are now spreading in conference rooms, government agencies and investor forecasts, Tesla carrying the weight of uncertainty. Despite Trump’s last insurance that he wants Musk companies to “thrive”, the markets remain cautious.
