Musk-Trump Messy Breakup Wipes Out $150B in TSLA Stock: What's Next?

Core Insights - The relationship between Elon Musk and President Donald Trump has deteriorated significantly, impacting Tesla's market value and investor sentiment [1][2] - Musk criticized Trump's proposed budget bill, which could eliminate EV tax credits crucial for Tesla's growth, leading to a public feud that has rattled markets [2][8] Group 1: Market Impact - Tesla's stock fell 14% in a single day, erasing over $150 billion in market value, marking its worst drop on record [2][6] - Over the last five trading sessions, Tesla's shares have declined by more than $237 billion, falling below key technical levels [2][4] Group 2: Political and Regulatory Challenges - Trump's budget bill threatens to cut federal support for Tesla, including EV tax credits, which are vital for the company's competitiveness [8][10] - Musk's exit from the Department of Government Efficiency (DOGE) and the fallout with Trump may exacerbate Tesla's challenges, including slumping global sales and increased regulatory scrutiny [5][11] Group 3: Competitive Landscape - Tesla faces intensified competition from BYD, which has outsold Tesla in battery EVs for two consecutive quarters, highlighting Tesla's declining market position [9] - Tesla's sales in China fell 15% year-over-year in May, marking the eighth consecutive month of decline, while European sales have also dropped for five months straight [9] Group 4: Future Outlook - The ongoing feud and potential loss of federal support could jeopardize Tesla's ambitious robotaxi plans, especially as competitors like Alphabet's Waymo gain traction [10][11] - The Zacks Consensus Estimate for Tesla's 2025 EPS suggests a 22% year-over-year decline, indicating a challenging outlook for the company [14]