Trump Escalates Feud With Musk, Threatens Tesla And SpaceX Support

It comes after Musk's criticism that tax-cut and spending Bill would balloon US deficit

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WASHINGTON - US President Donald Trump on July 1 threatened to cut off the billions of dollars in subsidies that Mr. Elon Musk's companies receive from the federal government, in an escalation of the war of words between the President and the world's richest man, one-time allies who have since fallen out.

The feud reignited on June 30 when Mr. Musk, who spent hundreds of millions of dollars on Mr. Trump's re-election, renewed his criticism of Mr. Trump's tax-cut and spending Bill, which would eliminate subsidies for electric vehicle (EV) purchases that have benefited Tesla, the leading US EV maker.

"He's upset that he's losing his EV mandate and... he's very upset about things, but he can lose a lot more than that," Mr. Trump told reporters at the White House on July 1.

Mr. Musk's businesses, especially Tesla and SpaceX, are highly dependent on an array of federal contracts, policies, subsidies and credits that have provided the companies tens of billions of dollars in revenue over the years. Some of these benefits for Tesla, including consumer tax credits for EV purchases, were already on the chopping block in Mr. Trump's tax Bill.

Tesla shares dropped 4 percent in early trading on July 1.

The Tesla chief executive renewed threats to start a new political party and spend money to unseat lawmakers who support the tax Bill despite campaigning on limiting government spending.

The Senate approved the Bill on July 1 by a narrow margin, and it will now return to the House of Representatives for approval.