Trump Targets Musk’s US Contracts, Subsidies as Feud Grows

Jun 5, 2025

In this discussion, Ed Ludlow, co-host of Bloomberg Technology and an expert in the electric vehicle and space sectors, and Peggy Johnson, CEO of Agility Robotics with a rich background at Magic Leap and Microsoft, tackle the brewing feud between Trump and Musk. They delve into Trump's threat to cut Musk's government contracts, exploring its potential fallout on Tesla's stock. Ludlow highlights the impact of politicized electric vehicle markets, while Johnson shares insights on advancements in humanoid robotics and their implications for the business landscape.

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ANECDOTE

Rivian's Micro-Mobility Spinout

Rivian spun out its micro-mobility unit and raised $105 million in external funding this year.
The new business runs independently, leveraging Rivian’s technology for growth.

INSIGHT

Musk-Trump Relationship Collapse

The relationship between Elon Musk and Donald Trump deteriorated rapidly after Musk left Trump's advisory role.
President Trump publicly threatened to cut Musk’s governmental subsidies, impacting Tesla’s stock.

INSIGHT

Complexity of Canceling Musk Contracts

SpaceX and Tesla have received about $25 billion in federal subsidies and contracts since 2000.
Canceling these contracts is complicated due to their integration with U.S. defense and space operations.

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Watch Carol and Tim LIVE every day on YouTube: http://bit.ly/3vTiACF.

President Donald Trump proposed ending Elon Musk’s government contracts and subsidies, escalating the war of words between the world’s richest man and the president he helped elect.
“The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it!” Trump posted on his social media site Thursday.

Trump’s threat strikes at a main source of the billionaire’s wealth. Musk’s Tesla Inc. and Space Exploration Technologies Corp. have benefited from federal contracts and subsidies. Ending contracts with Musk’s companies could prove legally and practically unwieldy, given they are deeply intertwined with US space and defense operations.

Total revenue for SpaceX and Tesla from federal unclassified contracts since fiscal year 2000 is $22.5 billion, according to Bloomberg Government data. Tesla’s shares fell as much as 18% on Thursday, extending earlier losses after Trump floated ending Musk’s federal relationships.
“Go ahead, make my day,” Musk posted on X in response to Trump’s threat. The Tesla chief then alleged that Trump’s name appears in the files related to the late New York financier Jeffrey Epstein, who was accused of sex trafficking underage girls and later died by suicide while in federal detention.

“Time to drop the really big bomb: @realDonaldTrump is in the Epstein files. That is the real reason they have not been made public. Have a nice day, DJT!” Musk wrote. The White House declined to comment on the Epstein accusation.

Today's show features interviews from the Bloomberg Technology Summit in San Francisco:

RJ Scaringe, Founder and CEO of Rivian
Bloomberg Technology Co-Host Ed Ludlow
Peggy Johnson, CEO of Agility Robotics
Ashley Mayer, Co-Founder & General Partner, Coalition Operators and Helen Min, Venture Partner, True Ventures

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