{"id":355,"date":"2025-07-09T10:00:00","date_gmt":"2025-07-09T10:00:00","guid":{"rendered":"https:\/\/wakeupknotts.com\/?p=355"},"modified":"2025-07-10T13:51:31","modified_gmt":"2025-07-10T13:51:31","slug":"musks-third-party-push-puts-his-companies-at-risk","status":"publish","type":"post","link":"https:\/\/wakeupknotts.com\/index.php\/2025\/07\/09\/musks-third-party-push-puts-his-companies-at-risk\/","title":{"rendered":"Musk\u2019s third party push puts his companies at risk"},"content":{"rendered":"<p><iframe loading=\"lazy\" id=\"nxs-video-iframe\" data-frame-src=\"10873103\" width=\"640\" height=\"360\" sandbox=\"allow-scripts allow-same-origin allow-popups allow-popups-to-escape-sandbox\" layout=\"responsive\" src=\"https:\/\/redir1.thehill.com\/nxs-video-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\" scrolling=\"no\" frameborder=\"0\" allowfullscreen><br \/>\n\t\t<\/iframe><\/p>\n<p>Elon Musk\u2019s push to create a third political party is putting his business empire at risk once again, raising questions about how his political ambitions align with the interests of his companies.\u00a0<\/p>\n<p>After the tech billionaire launched his new America Party over the weekend, Tesla saw its <a href=\"https:\/\/thehill.com\/policy\/technology\/5387564-tesla-stock-drops-elon-musk-third-party\/\" target=\"_blank\" rel=\"noreferrer noopener\">shares tumble<\/a> Monday \u2014 the latest occasion in recent months in which the electric vehicle (EV) maker has taken a hit over its CEO\u2019s actions in the political sphere.\u00a0<\/p>\n<p>And President Trump has renewed his suggestion that the administration could take aim at Musk\u2019s various contracts and subsidies, leaving the vast sums of government money that SpaceX receives vulnerable.\u00a0<\/p>\n<p>\u201cThis turn is probably one of the biggest strategic errors I\u2019ve ever seen,\u201d Ross Gerber, a longtime Tesla investor and CEO of Gerber Kawasaki Wealth and Investment Management, told The Hill.\u00a0<\/p>\n<p>\u201cThis now puts them [Musk and Trump] in direct combat in a way that will only hurt Tesla even more,\u201d he added.\u00a0<\/p>\n<p>Tesla\u2019s stock fell a sharp 7 percent Monday morning when markets opened and investors took stock of Musk\u2019s decision to launch his America Party.\u00a0<\/p>\n<p>The Tesla CEO has repeatedly floated the idea of creating a third party since his falling out with the president last month. As the two men reignited their feud last week over Trump\u2019s sweeping tax and spending bill, Musk reiterated his proposal.\u00a0<\/p>\n<p>After polling his followers on his social platform X, <a href=\"https:\/\/thehill.com\/homenews\/campaign\/5386557-musk-announces-america-party\/\" target=\"_blank\" rel=\"noreferrer noopener\">Musk announced Saturday<\/a> he was moving forward with plans for the America Party.\u00a0<\/p>\n<p>\u201cWhen it comes to bankrupting our country with waste &#038; graft, we live in a one-party system, not a democracy,\u201d he wrote. \u201cToday, the America Party is formed to give you back your freedom.\u201d\u00a0<\/p>\n<p>Musk\u2019s decision to delve further into politics isn\u2019t sitting well with many investors, who appeared relieved by the tech mogul\u2019s earlier decision to step away from the Trump White House.\u00a0<\/p>\n<p>James Fishback, CEO and founder of investment firm Azoria, said Saturday that his company was postponing the public listing of a Tesla exchange traded fund (ETF) as a result of Musk\u2019s announcement.\u00a0<\/p>\n<p>&#8220;In May, when Elon stepped back from his work at DOGE and returned his attention to Tesla, we were encouraged,\u201d Fishback wrote on X. \u201cWith Elon fully engaged, he gave shareholders renewed confidence in Tesla\u2019s future.\u201d\u00a0<\/p>\n<p>\u201cElon&#8217;s announcement today undermines that confidence,\u201d he continued.\u00a0<\/p>\n<p>The Tesla CEO joined the Trump administration after spending at least $250 million to help boost Trump\u2019s 2024 campaign. Investors initially seemed optimistic about what Musk\u2019s role could mean for his companies, with Tesla\u2019s stock rising in the wake of the November election.\u00a0<\/p>\n<p>However, Musk\u2019s role leading the Department of Government Efficiency (DOGE) quickly became a drag on Tesla, as the EV maker became a political symbol for its CEO and DOGE&#8217;s controversial efforts to cut government spending and slash the federal workforce.\u00a0<\/p>\n<p>Tesla\u2019s stock sank,\u00a0while the company\u2019s cars and dealerships became targets for both peaceful and destructive protests. The EV firm reported a steep <a href=\"https:\/\/thehill.com\/policy\/technology\/5260868-tesla-earnings-drop\/\" target=\"_blank\" rel=\"noreferrer noopener\">71 percent drop<\/a> in earnings in the first quarter and a <a href=\"https:\/\/thehill.com\/policy\/technology\/5381097-tesla-vehicle-sales-decline\/\" target=\"_blank\" rel=\"noreferrer noopener\">13 percent dip<\/a> in global sales in the second quarter.\u00a0<\/p>\n<p>Musk ultimately decided to step away from the White House in May, vowing to shift his focus back to Tesla. But he soon became entrenched in a feud with Trump over the reconciliation bill and his concerns about the federal deficit, spurring the threats to create a third party. \u00a0<\/p>\n<p>\u201cThe last thing you want to see is Musk getting into politics at this juncture,\u201d Wedbush Securities analyst Dan Ives told The Hill. \u201cYou want him all focused on Tesla. And he\u2019s ultimately creating a foe in the White House with Trump and Republicans.\u201d\u00a0<\/p>\n<p>\u201cHe\u2019s risking a lot,\u201d he added.\u00a0\u201cIt puts Tesla in harm&#8217;s way. It creates more uncertainty. And the chances that independents gain any political foothold is very small. So it\u2019s kind of a lose-lose situation from the perspective of many Tesla shareholders.\u201d\u00a0<\/p>\n<p>Trump and other Republicans have lambasted Musk\u2019s push for a third party. The president <a href=\"https:\/\/thehill.com\/homenews\/campaign\/5387114-trump-criticizes-musk-third-party\/\" target=\"_blank\" rel=\"noreferrer noopener\">slammed his onetime ally<\/a> as a \u201ctrain wreck\u201d and suggested he had gone \u201ccompletely off the rails.\u201d\u00a0<\/p>\n<p>\u201cHe even wants to start a Third Political Party, despite the fact that they have never succeeded in the United States \u2013 The System seems not designed for them,\u201d Trump said in a post Sunday afternoon.\u00a0\u00a0<\/p>\n<p>Trump\u2019s ire could spell trouble for Musk\u2019s companies, which are highly dependent on government contracts. A Washington Post analysis in February found that his business empire had received at least $38 billion in government contracts, loans, subsidies and tax credits.\u00a0<\/p>\n<p>The president has on several occasions <a href=\"https:\/\/thehill.com\/homenews\/administration\/5378395-donald-trump-doge-elon-musk-companies\/\" target=\"_blank\" rel=\"noreferrer noopener\">raised the possibility<\/a> of targeting the tech mogul\u2019s contracts and subsidies, including last week, as Musk ramped up his attacks on Trump and the reconciliation bill.\u00a0<\/p>\n<p>\u201cElon may get more subsidy than any human being in history, by far, and without subsidies, Elon would probably have to close up shop and head back home to South Africa,\u201d he wrote on Truth Social, adding, \u201cPerhaps we should have DOGE take a good, hard, look at this?&#8221;\u00a0<\/p>\n<p>SpaceX, which has received more than $22 billion in government contracts, is particularly vulnerable to potential cuts. \u00a0<\/p>\n<p>\u201cI don\u2019t think it ever does any good for somebody like Elon Musk to annoy his biggest customer, which is the United States government,\u201d space policy expert Mark Whittington said. \u00a0<\/p>\n<p>However, he underscored the government is also highly dependent on SpaceX, making it hard for Trump to realistically cut off the company. \u00a0<\/p>\n<p>Musk\u2019s threat last month to decommission SpaceX\u2019s Dragon spacecraft, which is responsible for ferrying astronauts and cargo to and from the International Space Station, sent shockwaves through the space community. He ultimately walked back the threat.\u00a0<\/p>\n<p>\u201cSpaceX is so good at what it does, launching things into space, and is far beyond any of his competitors,\u201d Whittington added. \u201cThere\u2019s not much the federal government can do to him without alternatives.\u201d\u00a0<\/p>\n<p>As a result, SpaceX is in a \u201cbetter position\u201d than Tesla, Ives said. He argued Tuesday that the Tesla board of directors &#8220;must act\u201d to set ground rules for Musk going forward. \u00a0<\/p>\n<p>He suggested they take advantage of the ongoing legal battle over the Tesla CEO\u2019s current pay package, creating an incentive driven pay package that lays out expectations about the amount of time Musk needs to spend at the company and setting up a special committee to establish rules for his political endeavors.\u00a0<\/p>\n<p>In turn, the board could increase Musk&#8217;s voting control to 25 percent, which Ives said would create a scenario for Tesla to merge with xAI. Musk seemed unenthused by the proposal, writing on X, &#8220;Shut up, Dan.&#8221;<\/p>\n<p>However, Gerber appeared skeptical that the Tesla board would step in.\u00a0<\/p>\n<p>\u201c[Musk\u2019s] going to do whatever he wants, and he doesn\u2019t care,\u201d Gerber said. \u201cAnd the board isn\u2019t going to do anything about it.\u201d\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Elon Musk\u2019s push to create a third political party is putting his business empire at risk once again, raising questions about how his political ambitions align with the interests of his companies.\u00a0 After the tech billionaire launched his new America Party over the weekend, Tesla saw its shares tumble Monday \u2014 the latest occasion in recent months in which the electric vehicle (EV) maker has taken a hit over its&hellip;<\/p>\n","protected":false},"author":1,"featured_media":354,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-355","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology"],"_links":{"self":[{"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/posts\/355","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/comments?post=355"}],"version-history":[{"count":1,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/posts\/355\/revisions"}],"predecessor-version":[{"id":356,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/posts\/355\/revisions\/356"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/media\/354"}],"wp:attachment":[{"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/media?parent=355"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/categories?post=355"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wakeupknotts.com\/index.php\/wp-json\/wp\/v2\/tags?post=355"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}