De-escalation in Sight as Musk Reconsiders Dragon Exit Amid GOP Rift

A public disagreement between the President of the United States, Donald Trump, and Elon Musk, CEO of Tesla and SpaceX, escalated this week over a Republican-backed domestic policy bill. 

Musk has publicly criticized the bill, calling it an “abomination” for increasing the federal deficit. Meanwhile, President Trump responded by accusing the Tesla CEO of outrage over the removal of a Biden administration electric vehicle tax break that benefits Tesla.

The president continued, threatening to terminate government contracts with the billionaire’s companies, including SpaceX, which depends on billions in federal funding. 

Donald Trump’s comments (Source: Truth Social)

The Tesla CEO fired back on X, raising questions about Trump’s impeachment and suggesting his involvement in withholding Jeffrey Epstein-related documents. The dispute led to a 14% decline in Tesla’s stock price on June 5, resulting in a $150 billion loss in market value, a sign of investor concerns over how the dispute would affect them.

The conflict has strained Republican Party dynamics, as Musk, one of the largest financial contributors to the party’s 2024 campaign, and Trump, its political leader, hold high influence. 

Musk briefly served in an advisory role in Trump’s administration through the Department of Government Efficiency (DOGE), created to reduce federal spending, before their relationship deteriorated. The disagreement of a personal nature, with the Tesla CEO asserting Trump’s 2024 victory relied heavily on his support and Trump stating the Tesla CEO was “wearing thin,” portrays a sensational collapse of their previous collaboration.

Steps Toward Peace: Musk Softens Stance  

Musk has shown a willingness to reduce tensions. On June 6, 2025, he reversed a decision to retire SpaceX’s Dragon spacecraft, announced earlier in the day following the dispute. The reversal followed a suggestion from an X user to “cool off and take a step back for a couple of days,” to which he responded, “Good advice. Okay, we won’t retire Dragon.” 

Billionaire investor Bill Ackman, a mutual acquaintance, called for peace “for the good of our great nation,” prompting the Tesla CEO’s reply, “You’re not wrong.” 

House Speaker Mike Johnson also addressed the issue, addressing the Tesla CEO as a friend and urging policy differences to remain impersonal.

A call scheduled for June 6, 2025, between Musk and White House officials, suggests mediation efforts. The details of the call remain undisclosed, but it represents a step toward resolution, given SpaceX’s reliance on federal contracts and Musk’s position in Republican circles.

Money, Influence, and Party Unity on the Line

The online battle is a testament to the relationship between business interests and political dynamics. SpaceX’s federal contracts, valued in the billions, are at risk, with Trump risking losing a crucial donor after enjoying the Tesla CEO’s massive donations to his 2024 re-election campaign.

Tesla’s stock stabilized in after-hours trading on June 5, but investors remain cautious. 

The dispute tests Republican Party solidarity, with lawmakers using allegiances between two powerful leaders.