Trump-Musk spat weighs on Tesla

EV maker already hit by steep sales slide

- JACK EWING

Elon Musk’s bitter falling-out with President Donald Trump could be costly for Tesla.

As long as he is persona non grata in the Trump administration, Mr Musk, the CEO of Tesla, will struggle to persuade Republicans not to gut climate policies worth billions of dollars to the electric car and battery company.

Mr Musk may also lose sway over federal regulators who could make or break his plans to deploy driverless taxis, which he has described as the future of the company. Tesla could also become the target of a president known for seeking retribution.

Unless they reconcile, Mr Musk will have little to show for the damage that his alliance with Trump has done to Tesla’s image among liberals, who are much more likely to buy electric cars than the president's supporters.

Tesla is already suffering steep declines in sales and profit. The company’s share price plummeted 14% on Thursday, its biggest one-day decline, after Mr Musk and Trump began insulting each other on social media. The stock recovered somewhat Friday, rising nearly 4%, perhaps on hopes that the men would reach a truce or because investors thought the stock was now a bargain after the previous day's drop.

There was always a disconnect between Mr Musk and his Republican allies on electric cars. The domestic policy bill passed by House Republicans and being considered by the Senate will hurt the electric car market in the United States, where Tesla is the largest manufacturer by far.