In a surprising turn of tone, President Donald Trump stated Thursday that he would not target Elon Musk’s companies by removing federal subsidies, emphasizing that he wants Musk’s ventures—and all American businesses—to thrive. The statement follows recent political friction between the two prominent figures, once close allies.
The rift emerged after Musk publicly criticized Trump’s sweeping tax and budget legislation, which will end key federal subsidies for electric vehicles—including the $7,500 credit for new EVs and $4,000 for used ones—by September 30. Musk warned Tesla investors this week that the cuts could lead to “a few rough quarters” for the company.
On social media, Trump refuted speculation that he intended to punish Musk by pulling government support. “Everyone is stating that I will destroy Elon’s companies by taking away some, if not all, of the large scale subsidies he receives from the U.S. Government. This is not so!” Trump posted. “I want Elon, and all businesses within our Country, to THRIVE.”
In response, Musk clarified that SpaceX does not receive subsidies, but rather wins contracts through competitive bidding, citing that moving such contracts would jeopardize U.S. missions and cost taxpayers more.
The tension stems partly from Musk’s recent formation of a new political party and public denunciation of Trump’s tax bill, claiming it would bankrupt the nation. The fallout escalated further when reports surfaced that the Trump administration had directed federal agencies, including NASA and the Department of Defense, to review existing SpaceX contracts—raising the prospect of retaliation.
Despite the conflict, SpaceX remains a top contender for the $175-billion Golden Dome missile defense initiative, although sources indicate the administration is now exploring alternative partners.
Once instrumental in Trump’s campaign and budget reform efforts, Musk exited the administration in May to refocus on his private ventures. The current political strain underscores how quickly alliances can shift in Washington—and how much may be at stake for some of the country’s most high-profile tech innovators.
