The gloves have officially come off as a feud between billionaire Elon Musk and president Donald Trump has exploded into public view in spectacular fashion.

In the latest escalation, Trump threatened to cut Musk's government contracts.

"The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts," the president threatened in a Truth Social post. "I was always surprised that Biden didn’t do it!"

It's an especially noteworthy broadside, considering Musk's empire has been built on tens of billions of dollars' worth of government contracts. Both Tesla and SpaceX have massively relied on federal funds, saving them from certain doom on several occasions.

Case in point, in 2021, Musk admitted that NASA once saved his space company with a $1.5 billion contract.

But whether the money will continue to pour into Musk's pockets is as uncertain as ever, given the rapidly deteriorating relationship. The dam appeared to break on Thursday, with Musk and Trump openly taking potshots at each other, both online and off.

"Look, Elon and I had a great relationship," Trump told reporters. "I don't know if we will anymore."

Musk retorted on his social media platform X-formerly-Twitter, seething that "without me, Trump would have lost the election."

"Such ingratitude," the fuming Musk added.

Trump's threats appear to have panicked investors of Musk's EV maker Tesla. The company's shares, which have already been on a rollercoaster ride this year, plunged around 14 percent as the spat intensified, showing that investors were horrified by the implications of an escalating brawl between Musk and Trump.

What exactly Trump meant by "subsidies and contracts" remains uncertain. One possibility is that the president was referring to EV tax incentives, which are expected to be torpedoed in his "big, beautiful bill."

Without tax incentives — for now, many of Tesla's vehicles still qualify for a clean vehicle tax credit of up to $7,500 — Tesla's existing crisis could deepen even further. Musk's well-documented embrace of far-right extremism has proven incredibly damaging to the carmaker's brand, scaring away buyers worldwide.

"Elon was 'wearing thin,' I asked him to leave, I took away his EV mandate that forced everyone to buy electric cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!" Trump wrote on Truth Social.

"Such an obvious lie," Musk replied. "So sad."

The billionaire reiterated that he allegedly doesn't care about the EV tax credits, but called to "also cut all the crazy spending increases in the Big Ugly Bill so that America doesn’t go bankrupt!"

With his latest threat, Trump may also be referring to the billions of dollars worth of government contracts that Musk's SpaceX has relied on to keep afloat. His administration abruptly pulled the nomination of Musk's personal pick for NASA administrator, indicating a major parting of ways between the space agency and the billionaire's space company.

Meanwhile, Musk suggested through a poll on X to create a "new political party in America" to represent the "80 percent in the middle."

Unsurprisingly, his largely sycophantic supporters on the platform relished in the idea, with 83 percent voting "yes."

But the billionaire appeared to relish in the unfolding chaos, arguing that "one thing's for sure, it ain't boring!"

Whether Trump will make good on his threat remains to be seen. His tax bill will certainly become an even tougher pill to swallow now as it heads to the Senate, with several Republican lawmakers siding with Musk on the issue.

One thing's for sure: the fallout of the bill dying in Congress could be significant.

"If [Musk] actually successfully gets any votes switched to tank this bill and kills it," a senior Trump strategist told Wired, "then I think at that point he’s f*cking dead to Donald Trump."

More on the feud: Republicans Admit They Have Zero Respect for Musk, Were Just Using Him for Money and Clout


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