Tesla’s stock surged by more than 5% on Friday, following a tumultuous clash between CEO Elon Musk and President Trump that had previously slashed the company’s market value by $152 billion.
Investors were looking for clues that a reconciliation might be on the horizon after Tesla experienced its largest decline in over four years. However, Trump appeared to dismiss any chance for discussion, stating he had no interest in reconnecting with Musk.
“Are you talking about a man who’s lost his heart?” Trump remarked in an interview with ABC News regarding potential phone talks.
Musk, the richest person in the world, reportedly lost around $27 billion on Thursday alone, expressing disappointment over Trump’s inability to win the election without his assistance.
In retaliation, Trump threatened to jeopardize Musk’s government contracts.
Despite the setback the previous day, both Musk and SpaceX maintain their status as the wealthiest figures globally, with a collective net worth of $395.8 billion, according to Forbes.
In a related note, a Tesla short seller reportedly made $4 billion profit during a significant trading day on Thursday, as indicated by estimates from S3 Partners.
So far, investors have funneled around $7 billion into automakers, with Tesla holding the position of the second-largest stock in the U.S.
Dan Ives, an analyst at Wedbush Securities, suggested in a note on Friday that a reconciliation between Musk and Trump could greatly benefit Tesla’s stock.
Musk’s criticism on Thursday was directed at a spending bill supported by Trump, which had just passed the House and was awaiting approval from the Senate.
JPMorgan analysts have raised concerns that the proposed tax package would terminate an electric vehicle tax credit of up to $7,500 for buyers.
The bill also includes a new $250 annual fee for electric vehicle drivers.
At the same time, the Senate has recently moved to obstruct California’s electric vehicle sales mandate, which could potentially result in an additional $2 billion loss in sales for Tesla.
Such regulations could significantly reduce nearly half of the projected $6 billion in profits that Tesla is due to report this year, as noted by an analyst led by Ryan Brinkman in a recent report.
Meanwhile, Tesla’s sales have seen a sharp decline in key European markets, allowing the Chinese competitor BYD to surpass Tesla in several regions.
The brand’s public image has also taken a hit, with protests erupting nationwide and incidents of damage to Tesla showrooms and vehicles occurring.
