WASHINGTON, June 6 — Former President Donald Trump on Thursday threatened to terminate government contracts with Elon Musk’s companies, prompting the billionaire to suggest Trump should be impeached — a dramatic collapse of their once-close political alliance.
Contract Threats and Social Media Spat
Trump criticized Musk during a meeting in the Oval Office, later posting on Truth Social:
“The easiest way to save money in our Budget — Billions and Billions of Dollars — is to terminate Elon’s Governmental Subsidies and Contracts.”
Tesla shares plunged over 14% by market close, wiping out roughly $150 billion in market value — the company’s largest single-day loss in history.
In a swift response, Musk replied “Yes” on X to a post calling for Trump’s impeachment — a highly charged statement considering Republicans currently control both chambers of Congress.
Rift Over Budget Bill
Tensions escalated earlier in the week after Musk criticized Trump’s new tax-cut and spending bill, calling it a “disgusting abomination” that would add trillions to the nation’s $36.2 trillion debt. Trump, initially silent, expressed disappointment on Thursday:
“Very disappointed in Elon,” he told reporters.
Independent analysts estimate the bill could increase the national debt by $2.4 to $5 trillion.
SpaceX Fallout and Partial Retraction
Musk, whose company SpaceX is critical to the U.S. space program, responded to Trump’s threats by announcing plans to begin decommissioning Dragon — the only American spacecraft currently capable of carrying astronauts to the International Space Station. He later walked back the threat.
In a potential sign of de-escalation, Musk agreed with investor Bill Ackman’s suggestion that he and Trump should reconcile, replying, “You’re not wrong.”
Political Impact and Republican Tensions
Musk had served as head of the Department of Government Efficiency under Trump, spearheading efforts to cut federal spending. Though he stepped down from that role, he remains a prominent figure in conservative circles.
His opposition to Trump’s bill has widened divides within the GOP and could undermine the bill’s prospects in the Senate. A longtime Republican strategist noted:
“Elon was a significant part of the ground game last cycle. If he sits out the midterms, that worries me.”
Musk has previously said he will reduce political donations and recently posted:
“In November next year, we fire all politicians who betrayed the American people.”
Investor Jitters and Future Outlook
The fallout is already being felt at Tesla, where protests over Musk’s political involvement have disrupted operations and raised concerns among investors about his divided focus.
Meanwhile, Musk continues to lash out online, asserting that Trump’s tariff policies will push the U.S. into a recession and claiming:
“Without me, Trump would have lost the election.”
