Elon Musk vs Donald Trump feud: What's at stake here as Tesla boss takes on POTUS in this ‘big, beautiful’ fight?

Elon Musk and Donald Trump are undoubtedly two of the most followed and heard people across the globe, but now they have turned their megaphones on each other, paving the way for one big controversy. Their disagreement on government policies is taking a new shape. It started with Musk's criticism of the massive tax and domestic policy bill, which Musk had termed a "disgusting abomination."

Musk receives limited support, however, enough to make Trump nervous

Regarding the voting on the bill, Elon Musk has received support from only three House Republicans, including Reps. Thomas Massie (R., Ky.) and Warren Davidson (R., Ohio), who previously voted against the bill. Meanwhile, Trump cannot afford to lose more than three votes, as doing so could jeopardise the future of his "big, beautiful bill".

What's at stake for Musk?

For Elon Musk, the numerous government contracts that his company, SpaceX, has amassed over recent times, including the $15.2 billion in contracts from NASA, and the $5.8 billion from the Department of Defense, could be at stake. Donald Trump has already floated the idea of fiddling with Musk's business dealings with the federal government. This could significantly impact SpaceX's future, as government contracts form a fundamental part of the company.

Then comes the trickier aspects, which include the Securities and Exchange Commission investigation on Musk, which is related to the initial purchase of stakes in Twitter, which went on to later become X. An SEC investigation's furthering could mean a new headache for Musk, who already is knee-deep in government contracts, espcially with his other companies like Tesla and SpaceX.

Although SpaceX has relatively few government contracts, numerous federal policies directly affect its finances, including a $7,500 tax credit for electric vehicle buyers.

JPMorgan's letter spells trouble for Musk

Meanwhile, in an interesting development, a letter from JPMorgan to clients, sent out Thursday, estimates the loss of the EV tax credit could cost Tesla $1.2 billion a year, and the loss of regulatory credit sales could hit them by another $2 billion.

Tesla is the worst-performing large-cap stock this year, thanks to declining electric vehicle demand, Chief Executive Elon Musk's political controversies over his ties to far-right groups, and now, his public feud with President Donald Trump, per a Reuters report.

Tesla shares slumped on Thursday, after Trump on social media threatened to cut off government contracts with Elon Musk's companies, following Musk's sharp criticism of the president's signature tax and spending bill on his X social media platform, according to the report.