The stock market thrives on drama, but the explosive feud between Elon Musk and President Donald Trump has sent Tesla’s stock into a tailspin. Musk’s claim that he was instrumental in Trump’s 2024 election win provoked a fiery response, with Trump threatening to slash Tesla’s government subsidies and contracts. The result? A brutal 14.3% stock plunge, wiping out $151 billion in market value in a single day, with shares closing at $295.14. As whispers of a possible reconciliation circulate, investors are left wondering: is this dip a golden opportunity to buy Tesla, or a warning to steer clear? Let’s break down the chaos, weigh the risks, and decide if now’s the time to jump in.
The Feud: A Billion-Dollar Brawl
The Musk-Trump saga erupted when Musk slammed Trump’s tax and spending bill as a “disgusting abomination” on social media, escalating tensions from their once-chummy alliance .
Musk’s exit from his role as head of Trump’s Department of Government Efficiency (DOGE) added fuel to the fire. His departure, after 130 days as a special government employee, was meant to refocus on Tesla and his other ventures, but the public spat has raised fears of a tougher regulatory environment .
Could they reconcile? A senior White House official told NBC News that Trump is “not interested” in a call with Musk, but Trump’s history of backtracking—like pausing tariffs after Musk’s pushback—suggests a truce isn’t impossible . For now, the uncertainty is a dark cloud over Tesla’s stock.
Whose Side Are You On?
This isn’t about picking Team Musk or Team Trump—it’s about what the feud means for Tesla’s future. Musk’s supporters admire his boldness, arguing he’s protecting Tesla’s interests by challenging policies that could hurt EV adoption, like the proposed $250 annual EV driver fee . Trump’s backers see his subsidy threats as a defense of fiscal responsibility, but others view it as a personal vendetta that could harm a key American innovator.
From an investor’s lens, the drama is a distraction. The real focus should be Tesla’s fundamentals—sales, innovation, and regulatory risks—not the social media fireworks. Taking sides in the personalities risks missing the bigger picture: Tesla’s ability to navigate this storm.
Is $295 a Buying Opportunity?
Tesla’s stock at $295 is a high-stakes gamble. Here’s the breakdown:
Why Buy the Dip
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Robotaxi Potential: Tesla’s Robotaxi launch on June 12 in Austin could be a game-changer. Starting with 10 vehicles and scaling to 1,000, it aims to prove Tesla’s Full Self-Driving (FSD) tech and open a new revenue stream .
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Musk’s Track Record: Despite his controversies, Musk has a history of defying odds. Tesla’s rebound from past dips—like 2020’s 50% drop—shows resilience.
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Market Leadership: Tesla remains the EV king, with a $900 billion market cap and a loyal fanbase. Fundstrat sees $295 as “a good entry point” for long-term believers .
Why Hold Off
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Subsidy Risks: Trump’s threat to cut EV tax credits and contracts could hit Tesla’s margins hard. Subsidies account for a chunk of Tesla’s profitability, and their loss could trigger further declines .
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Sales Slump: Tesla’s global sales fell 20% in Q1 2025, with China and Europe particularly weak. An eight-month decline in China signals demand issues .
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Regulatory Hurdles: The NHTSA’s probe into Tesla’s FSD tech, following a fatal crash, could delay Robotaxi’s rollout, adding uncertainty .
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Brand Damage: The #TeslaTakedown protests and Musk’s political stances are hurting Tesla’s reputation, potentially impacting sales further .
Technical Outlook
Tesla’s stock chart shows volatility. After peaking at $436.23 post-election, it’s now at $295.14, with support around $280-$290 . A break below could test $250, while a Robotaxi-driven rally might push it to $350. The RSI at 45 suggests it’s neither overbought nor oversold, leaving room for movement either way.
Reconciliation: A Pipe Dream?
Could Musk and Trump patch things up? Trump’s history of flip-flopping—like pausing tariffs after Musk’s pushback—suggests it’s possible . Investors should brace for more volatility until there’s clarity.
Your Move: Buy, Hold, or Sell?
At $295, Tesla’s a high-wire act:
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Buy: Risk-tolerant investors might see this as a dip worth grabbing, especially with Robotaxi’s potential. A stop-loss at $280 is a must.
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Hold: With the launch days away, waiting for the outcome could clarify the path. A strong debut could spark a rally; a flop could deepen losses.
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Sell: If you’re spooked by subsidy risks or sales declines, cashing out now could dodge further pain. UBS predicts a 5% delivery drop in 2025, eyeing $250 .
The Robotaxi launch is the wildcard. A smooth rollout could lift Tesla to $350; delays or glitches might drag it to $250. Long-term, Tesla’s innovation keeps it in the game, but short-term, it’s a bumpy ride.
The Verdict
The Musk-Trump breakup has slammed Tesla’s stock, but a reconciliation could change the game. At $295, it’s a speculative buy for those who believe in Musk’s vision and Robotaxi’s potential. Cautious investors should wait for clarity post-launch or a dip closer to $280. The drama’s loud, but Tesla’s fundamentals—sales, tech, and regulation—will call the shots. Dare to buy? Only if you’re ready for the rollercoaster.
What’s your take—buying the dip, holding tight, or steering clear? Drop your thoughts below!
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