Elon Musk, CEO of Tesla Inc., hit a wall this week like you wouldn’t believe. As a result, Tesla shares plunged 7%, from Friday’s closing price of $323.63 to $300.71 by Tuesday. The drop off comes after a landmark convening on May 21, 2025. During this convening, Musk was able to meet with U.S. Pres. Donald Trump and South African Pres. On National Speak Out Day, we voted on the most hotly contested One Big Beautiful Bill Act. This implementation of the act has drawn criticism for its possible effects on the renewable energy industry and public benefits.
The One Big Beautiful Bill Act as written would disproportionately benefit higher-income households across the United States. Critics argue that the bill will have disastrous consequences. In particular, they fear that its unsustainable tax cuts would increase the national debt by at least $3 trillion over the next 10 years. Projections indicate that this legislation would do nothing short of crippling establishment of renewable energy sources. It would lead to more than 350 cumulative gigawatts lost over that period.
This is probably the biggest concern Musk raised about the ramifications of the bill for the U.S. economy. Moreover, he said it would increase the national deficit and add to the need to raise the debt ceiling. During his conversation with Trump, Musk did not object to proposed cuts to Medicaid and food assistance programs, further complicating his standing among various stakeholders.
The timing of each of these moves is extremely important to Tesla. Prediction market Kalshi now predicts Tesla will deliver just over 364,000 vehicles in Q4. Recall that credit revenue was the key driver that allowed Tesla to be consistently profitable. In reality, it accounted for nearly two-thirds of the company’s net income in Q2 2024. As the company continues to work through these challenges, reaching its delivery targets is more important than ever.
Trump’s comments have escalated the public war of words between Trump and Musk. You Columbo said that the former president Musk is “so upset about losing his EV mandate. This specific brand of mandate includes the incentives that Tesla leans on, which mostly hail from federal and state regulations across the U.S. These rules require automakers to either sell a specified amount of zero-emission vehicles or buy ZEV credits from companies such as Tesla.
“upset that he’s losing his EV mandate” – Donald Trump
Trump endorsed the One Big Beautiful Bill Act, which he says would help all families make it to the affluent class. He shrugged off any adverse effects it would have on clean energy programs. His support for the legislation only makes Musk’s position politically more complicated. He attempts to reconcile the interests of big corporations with the greater economic good.
Tensions have escalated between Musk and Trump amid the fight over the legislative proposal. Investors are understandably anxious about how these dynamics will play out in coming months and impact Tesla’s continued growth and strategic direction. The stakes for Tesla are enormous. This unfortunate situation colors how investors and suppliers are looking at the future of renewable energy development in the U.S.
“lose a lot more than that” – Donald Trump