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Elon’s $150B Oops

Elon’s $150B Oops

Plus: CEO drama, quick takes, and what’s next in tech.

Roko's Basilisk
June 10, 2025

Here’s what’s on our plate today:

🚗 Musk’s political circus knocks $150B off Tesla (and investors are not amused).
🧠 Which risky CEO move would you bet the company on? Take the AI Quiz.
💡 Use AI to spot boardroom drama in 150 words (plus: 3 new tools to try).
🌎 Around the Horn: Klarna’s AI warning, UK’s DeepMind consult, and iOS 26 gets a facelift.

Let’s dive in. No floaties needed…

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The Laboratory

How Musk’s political escapades cost Tesla shareholders $150 billion in market value

Heading a multi-billion dollar company can be a challenge for many, one capable of encumbering an individual to the extent that they spend their lives dealing with the fires that need to be tended. Running multiple companies that aim to reshape the aspirations of human civilizations is like challenging the frontiers of what is humanly possible.

Elon Musk has been doing just that: the billionaire has founded, co-founded, and run six companies with market valuations in the billions of dollars. And the pressure is showing. The recent spat between Musk and US President Donald Trump poses challenges not just for the billionaire but also for investors. The spat, however, is not an isolated incident, but a disaster in the making.

Initially known for his entrepreneurial ventures, co-founding PayPal, leading Tesla and SpaceX, and acquiring Twitter (now X), Musk was largely apolitical in public discourse. However, his political stance began to shift notably with his endorsement and later participation in the government of the current President. Now it seems the relationship has soured, and shareholders are paying the price.

Recently, Tesla shares went into free fall after a public feud between Musk and Donald Trump. As investors watched, Tesla shares fell by nearly 14%, wiping $150 billion in market value.

So, how did the largely apolitical Musk land himself and his investors in such a soup? Let us take a look.

The apolitical Musk

For much of his early career, Musk was widely viewed as a centrist and largely apolitical innovator. His public endorsements reflected a moderate position: he supported Barack Obama in both the 2008 and 2012 U.S. presidential elections, and later backed Hillary Clinton in 2016.

Musk even agreed to serve on two presidential advisory councils, but he lasted less than six months, resigning from both in protest of the administration’s decision to pull out of the Paris Climate Accord. Musk often described himself as “half Democrat, half Republican,” emphasizing a fiscally conservative yet socially liberal stance. He routinely stressed a focus on technological progress and economic efficiency over political ideology.

While Musk routinely contributed to political campaigns, they can best be described as him being involved due to his business interests. This positioning contributed to the perception of Musk as a pragmatic leader more interested in solving engineering problems than aligning with political parties. However, things soon began to change.

The Trump skeptic

Musk could at best be described as a skeptic when it comes to Donald Trump. In October 2015, he said it would be "embarrassing" if Trump won the Republican party nomination, much less the presidency.

But by 2017, his political donations started skewing, with Musk spending nearly seven times more on the Republican Party campaigns than Democratic ones.

During the Biden administration, Musk continued to support the Republican party and was not too keen on aligning himself with Trump, even going to the extent of saying that Trump shouldn't run for president again and instead just "sail into the sunset."

The Twitter effect

Things changed rapidly after Musk took control of Twitter, now X, at the end of 2022. Soon after taking control of the platform, Musk reinstated Trump’s account after it was suspended due to the risk of incitement of violence following the storming of the U.S. Capitol in 2021.

Musk also repeatedly criticized Biden, and after Trump’s felony conviction, he decided to side with the former President, saying that “If a former President can be criminally convicted over such a trivial matter – motivated by politics, rather than justice – then anyone is at risk of a similar fate.”

Taking note of his support, Trump talked about including Musk in his administration.

The relationship between Musk and Trump reached new heights after Trump was shot during a campaign rally in Pennsylvania during the run-up to the 2024 elections.

By the end of his campaign, Musk had spent over a quarter of a billion dollars to help Donald Trump win his second term in the Oval Office. Musk also played an important role in Trump's transition team.

The bromance unravels

During the early days of the second Trump administration, Musk was given control of Doge, an advisory body which was created by an executive order signed by the President.

Part of Doge's mission was to bring about IT upgrades aimed at boosting efficiency. However, it was unable to achieve the promised results, and things began to sour between the President and Elon Musk after the former’s “big, beautiful bill” was passed by the House of Representatives in May 2025.

Musk criticized Trump’s new tax bill, claiming it removed key EV incentives. Trump retaliated by threatening to cut all federal subsidies and contracts awarded to Musk’s companies. Musk, meanwhile, retaliated by replying “yes” to a post on X saying Trump should be impeached.

It is important to note here that the US Transportation Department plays a critical role in regulating autonomous vehicle standards and could create rules, such as requiring lidar (laser-based sensors), that disadvantage Tesla, which only uses cameras.

The fallout also hit Musk’s wealth, knocking $34 billion off his net worth and damaging Tesla’s brand at a time when its EV sales are already down in the U.S., Europe, and China. The proposed end to the $7,500 EV tax credit and changes to California’s EV mandates could cost Tesla over $3 billion annually.

The impact on investors

Musk’s political escapades have impacted investors in Tesla, wiping out $150 billion in market value. However, the company continues to be one of the most valuable carmakers in the world.

Meanwhile, Tesla investor Ross Gerber warned the feud could lead to increased regulatory scrutiny. Other analysts echoed concern that Musk’s political flip, from supporting Trump to attacking him, has become a major liability. Tesla’s shift toward autonomous driving as its future revenue driver is particularly vulnerable to federal oversight.

Musk’s other companies, including SpaceX, could also face challenges due to his feud with the President. SpaceX currently holds substantial contracts with various US government agencies, including those with NASA, the Department of Defense, and intelligence agencies, which could be revoked or face operational challenges.

What’s Next for Musk and His Investors?

The fallout from Elon Musk’s political feud with President Trump has left investors questioning what lies ahead for Tesla and Musk’s broader business empire. While the $150 billion market value loss is staggering, the bigger concern may be long-term regulatory and financial repercussions. With federal EV subsidies and regulatory credits at risk, Tesla could face billions in lost revenue annually.

For SpaceX, whose success is closely tied to U.S. government contracts with NASA, the Pentagon, and intelligence agencies, political retaliation could disrupt funding, launches, or future bid approvals. Meanwhile, X (formerly Twitter) and xAI, both personal passion projects for Musk, risk becoming politically polarizing platforms that scare off advertisers, users, or investors.

For shareholders, the path ahead may hinge not just on product innovation but on whether Musk can separate personal politics from public company leadership, or whether the chaos becomes the new normal.

AI Quiz

Which move is most likely to cause a $150 billion drop in a tech company’s market value?

Prompt of the Day

Use this with ChatGPT, Gemini, or your LLM of choice:

Prompt: “Summarize today’s biggest news about a tech CEO (like Elon Musk) in less than 150 words. List the main risks for investors, and suggest 2 ways a company can limit the fallout from executive drama. Write it like a board briefing—snappy, not snarky.”

Treats to Try

Glasp—Highlight and summarize web content with AI. This app lets you save web highlights, create summaries with AI.
Rewind—Effortlessly record and search your entire computer history. Rewind uses AI to let you “rewind” your digital life.
Ideogram—Generate fun, custom images using text prompts. Move over, Midjourney: Ideogram creates meme-worthy or beautiful AI images.

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