Trump says he won't 'destroy' Musk's companies by taking away subsidies

President Donald Trump on Thursday denied claims that he wants to wreck Elon Musk's companies and their work with the U.S. government.

"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," he said in a post to Truth Social. "This is not so! I want Elon, and all businesses within our Country, to THRIVE, in fact, THRIVE like never before!"

"The better they do, the better the USA does, and that's good for all of us," Trump wrote.

Trump's response comes as the pair have continued a war of words that began with Musk's opposition to the president's signature spending bill, and evolved into the Tesla CEO attacking the president's relationship with convicted sex offender Jeffrey Epstein.

In June, the president threatened to cut some of Musk's government contracts as the two clashed over the "Big Beautiful Bill" and their relationship unraveled.

Musk previously headed the president's Department of Government Efficiency and funneled hundreds of millions into Trump's re-election campaign.

On Wednesday, the tech CEO said on a second-quarter earnings call that Tesla could experience a "few rough quarters" due to tariff costs and the expiration of federal electric vehicle benefits at the end of September.

Earlier in the day, White House press secretary Karoline Leavitt suggested that the administration doesn't want federal agencies to work with Musk's artificial intelligence startup xAI.

Her remarks come after the Pentagon announced July 14 that it had awarded xAI and three other AI companies contracts worth up to $200 million each.

Musk's aerospace and defense contractor SpaceX also has massive contract exposure in the US.

The re-usable rocket maker has received over $22 billion from work with the federal government since 2008, according to FedScout, which does federal spending and government contract research. That includes contracts from NASA, the U.S. Air Force and Space Force, among others, but does not reflect contract revenue from confidential initiatives.

The Trump administration recently reviewed SpaceX federal contracts to see if there was potential for cuts, according to the Wall Street Journal. The review found most were critical.

Musk's automaker, Tesla, has reported $12.24 billion in sales of "automotive regulatory credits," or environmental credits, since 2015, according to an evaluation of the EV maker's financial filings by FedScout CEO Geoff Orazem and CNBC.

This included $439 million in regulatory credit sales during the second quarter of 2025.

Such incentives were largely derived from federal and state regulations in the U.S. that require automakers to sell some number of low-emission vehicles or buy credits from companies like Tesla, which often have an excess.

Regulatory credit sales go straight to Tesla's bottom line.

In its quarterly financial filing on Thursday, Tesla mentioned the Trump-backed "One Big Beautiful Act" by name in its Risk Factors.

"The loss of previously available tax credits and carbon offset mechanisms may further negatively impact our financial results," Tesla's filing said.

The company added that "provisions of the OBBBA could affect battery cell expenses and impact costs for our consumers, negatively impacting demand."

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