Elon Musk and Donald Trump are undoubtedly two of the most followed and heard people across the globe, but now they have turned their megaphones on each other, paving the way for one big controversy. Their disagreement on government policies is taking a new shape, which started with the criticism of the massive tax and domestic policy bill, which Musk had termed as a “disgusting abomination.”
Regarding the voting on the bill, Elon Musk has received support from only three House Republicans, including Reps. Thomas Massie (R., Ky.) and Warren Davidson (R., Ohio), who previously voted against the bill. Meanwhile, Trump cannot afford to lose more than three votes, as doing so could jeopardize the future of his “big, beautiful bill”.
For Elon Musk, the numerous government contracts that his company, SpaceX, has amassed over recent times, including the $15.2 billion in contracts from NASA, and the $5.8 billion from the Department of Defense, could be at stake. Donald Trump has already floated the idea of fiddling with Musk’s business dealings with the federal government. This could significantly impact SpaceX’s future, as government contracts form a fundamental part of the company.
Then comes the trickier aspects, which include the Securities and Exchange Commission investigation on Musk, which is related to the initial purchase of stakes in Twitter, which went on to later become X. An SEC investigation’s furthering could mean a new headache for Musk, who already is knee-deep in government contracts, espcially with his other companies like Tesla and SpaceX.
Although SpaceX has relatively fewer government contracts, there are numerous federal policies that directly affect its finances, including a $7,500 tax credit for electric vehicle buyers that allows Tesla and other automakers to raise prices.
JPMorgan’s letter spells trouble for Musk
Meanwhile, in an interesting development, a letter from JPMorgan to clients, which was sent out Thursday, estimates the loss of the EV tax credit could cost Tesla $1.2 billion a year, and the loss of regulatory credit sales could hit them by another $2 billion.