Elon Musk's recent decision to step back from politics had investors optimistic, hoping he would focus on his tech firms. However, his recent public spat with former President Donald Trump signals a more complicated scenario. The back-and-forth has reportedly put Musk at odds with Trump's administration, leading to concerns about significant repercussions for his businesses, particularly Tesla.
This week, Tesla's stock plummeted by 14% following Musk’s provocative comments on social media regarding Trump. Though shares saw a slight rebound the next day, investors have been less than pleased with Musk's ability to balance his commitments to his companies. Analyst Dan Ives characterized the situation as tenuous, emphasizing the importance of Musk's focus on Tesla, particularly as it competes in the rapidly evolving autonomous vehicle market against the likes of Waymo.
Critics, like seasoned tech journalist Kara Swisher, believe that Tesla may already be facing deeper issues: "They are significantly behind," she asserted, forecasting challenges ahead. Musk aims to oversee the launch of fully autonomous robo-taxis in Austin; however, skepticism about his focus raises concerns about the project's success.
In addition to Tesla's turmoil, Musk faces grassroots opposition to his business practices across social media platforms. Protests under the hashtag #TeslaTakedown have emerged, expressing frustration over his perceived influence on democracy and the corporate world.
Interestingly, Musk's conflict with Trump could paradoxically serve to rehabilitate his image among skeptics who disapproved of his earlier associations with the former president. Analysts speculate that similar to Bill Gates, who transitioned from an unpopular figure in tech to a philanthropist, Musk too may evolve.
As both Musk and Trump navigate this fraught landscape, the potential for one to undermine the other looms. Trump's threats to cut government contracts valued at $38 billion could jeopardize ventures like SpaceX and Starlink. Nevertheless, both sides appear to have become too integrated within each other's spheres to simply sever ties without consequences.
Whether this public feud leads to a greater divide or an unexpected collaboration remains uncertain, but one thing is clear: Musk and Trump's relationship will continue to influence the trajectory of Musk’s business empire moving forward.
