Trump has threatened to stop subsidizing Tesla and SpaceX. What about the stocks?

US President Donald Trump, after a short break, resumed criticism of Ilon Musk, accusing the head of Tesla and SpaceX of being too keen on subsidies from the US budget and threatening to stop government funding. Tesla shares reacted by falling.

«Elon has probably received more subsidies than any person in history, by a huge margin, and without those subsidies he would probably have to close the business and go home to South Africa,» Trump wrote on Truth Social. «No more rocket launches, satellites, or electric car production - and our country will save COUNTRY. Maybe the [efficiency department] DOGE should look into this properly? HUGE COST SAVINGS!!!!» - he added.

Trump's statement came after Musk, after weeks of silence, again criticized the bill on tax cuts and spending growth promoted by Trump. The entrepreneur promised to get the resignation of congressmen who supported the document, despite campaign promises to limit government spending. Musk also once again called for the creation of a new political party. According to his words, the multi-trillion dollar government spending shows that «we live in a one-party country - in [the country of] the GOVERNMENT PARTY!!!». To Trump's threat to end subsidies for electric cars and space launches, Musk responded on his platform X responded, «I'm literally saying CANCEL IT ALL. Right now.»

Against this backdrop, Tesla shares fell 5% after the opening of pre-market trading on Nasdaq. On June 30, Deutsche Bank reiterated a Buy recommendation for Tesla shares with a target price of $345 per share, while JPMorgan reiterated a Sell recommendation and a $115 target. The electric car maker's consensus investment rating has remained neutral (Hold) in recent months. The average target of $311 per paper implies a 2% decline in their value over the next year.

SpaceX shares are not traded on stock exchanges. On the OTC market, the securities of space rocket manufacturer and satellite network operator Starlink have remained relatively stable in 2025, despite problems in Musk's business empire and turbulence in the space technology sector, noted Crunchbase. According to data from the Forge platform, SpaceX shares are up 7% since the start of 2025.

Much of the government funding received by Tesla is related to tax credits for electric vehicles and investments in energy infrastructure. SpaceX has become a key contractor for NASA and the U.S. Space Force. According to calculations by The Washington Post, Ilon Musk and his companies have received $38 billion in government contracts, loans, subsidies and tax credits over more than two decades. The publication notes that nearly two-thirds of that amount has been awarded to Musk's companies over the past five years. In 2024, federal and local governments provided a record $6.3 billion to his companies, the newspaper confirmed.

According to data from The Washington Post, SpaceX has received at least $1 billion annually in government contracts, loans, subsidies and incentives since 2016, and between $2 billion and $4 billion between 2021 and 2024. Tesla has received more than $1 billion annually from the U.S. government since 2020.

On June 2, Tesla is due to release its second-quarter electric car sales figures - the market is expecting a decline, reports Reuters. Visible Alpha estimates that Tesla will deliver 394,000 cars in the second quarter - down 11% from a year ago. This is a continuation of a trend: deliveries fell 13% in the first quarter.

To reach growth as early as 2025, Tesla will need to sell more than a million cars in the second half of the year. This will require a record and a serious effort - even taking into account the seasonal revival. The hope is for a new budget model. Presumably it will be a simplified version of the Model Y. Tesla has promised to start production by the end of June, but according to data from Reuters, the release has been pushed back at least a few months.

This article was AI-translated and verified by a human editor