TSLA drops 14% as investors see corruption being priced out of Tesla stock
Tesla stock dropped over 50 points today, primarily in response to a very public feud between Tesla CEO Elon Musk and convicted felon Donald Trump.
But, as we pointed out in November, this doesn’t have anything to do with company performance, and rather only reflects a change in the market’s expectation of potential benefit to Tesla from government corruption.
Tesla stock has had a wild few months, with big rises and falls that has had little to do with company performance (which is, perhaps, nothing new for the stock, which has always been a speculative vehicle).
Much of the movement of TSLA has been centered around CEO Elon Musk’s relationship with Donald Trump.
Musk very publicly supported Mr. Trump’s run for president, giving hundreds of millions of dollars in bribes to Mr. Trump’s campaign, despite the latter’s openly anti-EV positions (and despite that there exists a clear legal remedy stopping insurrectionists from holding office in the US).
Musk even went on to spew climate denying nonsense alongside Mr. Trump during the campaign, and later said nothing when Mr. Trump opposed the Paris Agreement, even though he previously opposed a similar move in 2017.
This led to Musk being invited into an advisory role, which was dubbed the Department of Government Efficiency despite it not being a real government department, and having a supposed mission redundant with the already-existing Government Accountability Office.
And in the immediate aftermath of the election, TSLA stock rose swiftly, purely because of expectations of corruption. But after that swift rise, it gradually fell as the reality of economy-destroying tariffs, anti-EV legislation, and Tesla’s brand perception problem due to Musk’s actions all became apparent. Despite Musk’s position as a top republican party donor, the party still seems more interested in catering to its traditional base in the fossil fuel industry.
Despite some recovery from that big post election rise-and-drop, TSLA took another big hit today, and it’s all due to the current rift forming between these two egomaniacs.
A rift over spending becomes something greater
During his tenure in his advisory position, Musk claims to have saved the government hundreds of billions of dollars, but independent accounting has shown that it is in fact likely to increase the deficit, not decrease it.
Nevertheless, it seems like Musk was fooled into believing his own propaganda, and into thinking that deficit reduction was ever a goal of Mr. Trump, despite that he previously oversaw the highest nominal deficit of any person in the history of the United States.
At least, he believed that until now. In the last few days, after leaving his advisory position, Musk has loudly opposed the new republican budget bill, which he now correctly points out will add trillions of dollars to the US deficit (as any lucid person might have predicted from the party of waste).
The criticism came to a head today, with Musk going through one of his patented tweetstorms, acting more like a jilted lover than a CEO in charge of a company that has many people’s retirement invested into it.
There’s been a lot of back and forth, but over the course of the day, Musk has posted many statements about how dangerous the budget bill will be for the US debt and deficit.
Mr. Trump responded, stating that Musk should have known these things before now, but that Musk is only acting this way because he cut the “EV mandate.”
To be clear, the bill in question does not cut any EV mandate, as there was never an EV mandate to begin with, but it does cut EV tax credits which Tesla has gained more benefit from than any other company, though Tesla lobbied in support of these cuts. The bill does not cut support for oil and gas companies, which are orders of magnitude higher than the support EV companies get.
In response to this, Musk claimed that he personally swung the election in favor of the republicans, and that Mr. Trump is showing “ingratitude” by not recognizing this fact.
Mr. Trump responded by suggesting that the government could save money by terminating all of the subsidies and contracts for services with Musk’s various companies. To this, Musk said that he would immediately decommission the Dragon capsule, which has been the main spacecraft used by NASA to service the International Space Station.
Then, Musk went on to state that a recession will happen in the second half of this year due to Mr. Trump’s position on tariffs, and also to accuse Mr. Trump of being on Jeffrey Epstein’s list (which is not the first time Musk has publicly accused someone of pedophilia, though it is the first time he’s said that about someone who he claimed to “love as much as any straight man can,” and knowingly worked alongside), and to agree with a call for his impeachment.
The market sees this as a negative sign
The public rift seems to have shaken the stock market out of its stupor, as Tesla went down more than 50 points since the start of today.
While nothing significant has changed for Tesla’s business today – it’s still suffering from falling sales in an otherwise rising market, and it still has a bad CEO – what has changed is the possibility of the company benefitting from corruption.
As I stated during TSLA’s meteoric post-election rise, the stock price was merely a reflection of the market’s expectation that Mr. Trump, a person with an enormous history of corruption, would thank Musk for his election participation by rewarding him and his companies. Nobody quite knew how that might happen, but everyone expected that it would.
I claimed, at the time, that this was unlikely to turn out the way the market thought it would, because the republicans would likely continue to favor fossil fuels, and that regulatory blockages were not the thing holding Tesla back from its automation goals.
Musk did attempt to use the government in corrupt ways, as detailed this week in a report by Senator Warren, and as we all remember from the White House Auto Mall infomercial (remember, folks, “everything’s computer!“).
But none of that was ever going to justify the addition of hundreds of billions of dollars to Tesla’s market cap.
The market seems to be realizing that more today, as over $100 billion has been shaved off of Tesla’s market cap since the start of the feud. That’s quite a lot of priced-in expected benefit that has been wiped away, all by a single tweetstorm.
Fight shows how vulnerable Tesla is to Musk’s whims
While it’s all well and good to see the worst two people you know fighting each other, and to finally see the inevitable fallout between two narcissists who frankly held out much longer than any reasonable person thought they would, this fight does show the significant vulnerability that Tesla has to the whims of a CEO who has shown poor ability to control his impulses in the past.
The last year or more has been highlighted by several poor business decisions by Musk, not the least of which is his support of one of the larger anti-EV entities on the planet right now.
But beyond the politics, his leadership has still been erratic for the company. Not only has he paid more attention to the many other companies he runs, when he has turned his attention to Tesla, it hasn’t been positive for the company.
After mostly ignoring Tesla for a few years, he went through a flurry of activity in the run-up to last year’s shareholder advisory vote on his compensation package. This flurry involved firing everyone including important leadership and successful teams, canceling an all-important affordable car project (and lying about it) and holding Tesla’s AI projects hostage while shifting both resources and staff from Tesla to his private AI company, even as he claims that AI is the future of Tesla.
Now, TSLA investors have another thing to worry about – whether Musk will continue to try to “poke the bear” and get more government opposition to his company, even as he continues to make himself distasteful globally (by, for example, showing support for German neo-Nazis, agreeing with a defense of Hitler’s actions in the Holocaust, or his many other white supremacist statements). These actions have driven protests against the company, embarrassed owners and pushed many customers away – and those protesters aren’t planning on stopping.
While some may cheer this new rift that has formed between Musk and one of the environment’s greatest enemies, Donald Trump, it seems unlikely that Musk’s erratic behavior will be beneficial for Tesla the company in the long run.
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Element3 just raised a fresh round of funding to launch the first US commercial lithium extraction plants, and it’s sourcing the lithium from oil and gas wastewater in Texas. That’s a big deal because it means there will be a domestic lithium supply for EVs and battery storage within a few months.
The critical materials extraction company announced the close of its Series A funding round led by TO VC. Fort Worth, Texas-based Element3 will use the money to deploy its first extraction plants on oil and gas company Double Eagle Energy Holding’s water infrastructure in the Permian Basin by the end of 2025. That means Element3 will become the first new lithium extraction player in the US to reach commercialization, with its first commercial shipments expected by year-end.
Element3’s breakthrough technology pulls battery-grade lithium from the Permian Basin’s produced water, turning a waste stream from oil and gas drilling into a valuable domestic resource. With a lithium carbonate plant already installed in the region, the company says its vertically integrated setup is ready to supply lithium for the US energy transition.
“This funding accelerates our mission to build American lithium independence from the ground up,” said Hood Whitson, Element3’s founder and CEO. “While other US projects are still in planning and years away from production, we’re bringing our plants online now and shipping product this year. Using existing oilfield infrastructure, we can move faster, cleaner, and at a fraction of the cost.”
The US oil and gas industry produces over 1 trillion gallons of wastewater annually, containing an estimated 250,000 tons of lithium carbonate – more than half the country’s projected supply gap by 2030. By tapping into that wastewater, Element3 avoids many challenges that delay conventional lithium mining, such as lengthy permitting, land disruption, and high carbon emissions. Instead, it uses existing infrastructure, turning waste into a new, low-carbon supply stream.
Recovering lithium from wastewater is significantly more environmentally friendly than conventional mining. It doesn’t require digging new pits, evaporating vast ponds, or consuming large amounts of fresh water. It also eliminates the need to transport raw materials internationally, helping reduce emissions tied to global supply chains.
“So much capital has gone into onshoring battery manufacturing, but far less into securing the upstream supply of lithium itself,” said Joshua Phitoussi, managing partner at TO VC. “Traditional mining takes billions and more than a decade to bring online. Element3’s approach is faster, cheaper, and uses an already abundant resource. This means that Element3 will be the first [direct lithium extraction] company to get to commercial scale, and could become a top three domestic lithium producer within the next three years.”
Read more: A $1.2B battery-grade lithium refinery breaks ground in Oklahoma
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The US Department of Energy (DOE) announced it will spend $625 million to “expand and reinvigorate” the US coal industry, claiming it will boost energy production and help rural communities. Energy Secretary Chris Wright praised “beautiful, clean coal” as “essential to powering America’s reindustrialization and winning the AI race.”
The Trump administration argues this spending will keep aging coal plants running, lower electricity costs, and prevent blackouts. But this so-called coal revival plan wastes millions when clean energy is cheaper and growing at a breakneck pace.
What the $625 million will fund
According to the DOE press release, the funds will prop up coal-fired power plants through several programs:
- $350 million to restart or upgrade old coal plants, improving their capacity and reliability.
- $175 million for projects bringing power to rural areas, aiming to deliver cheaper, more reliable coal-fired electricity.
- $50 million to upgrade coal plant wastewater systems, reducing water pollution and extending plant life.
- $25 million for “dual-firing” retrofits, so plants can switch between coal and other fuels like natural gas.
- $25 million to develop 100% natural gas co-firing, keeping boilers running efficiently if a plant uses gas instead of coal.
Wright claims these DOE coal investments will “keep electricity prices low and the lights on without interruption.” He also touted coal as the “backbone” of industries like steel and cement, insisting it’s “necessary to feed the AI boom.” In short, the administration is betting that propping up coal now will secure US energy supply for factories and data centers.
Interior Secretary Doug Burgum also said at a press conference in Washington that 13.1 million acres of federal land will be opened up in Montana, North Dakota, and Wyoming for coal leasing.
‘This is a colossal waste of money’
Environmental experts and clean energy advocates blasted the DOE’s coal plan as wasteful, polluting, and economically foolish. “The Trump administration is hell-bent on supporting one of the oldest, dirtiest electricity sources. It’s handing our hard-earned tax dollars over to the owners of plants that cost more to run than new, clean energy, while giving those plants a free pass to keep polluting,” said Amanda Levin, policy analyst at NRDC. “Propping up coal means dirtier air and water, destruction of public lands, and higher utility bills for struggling families… This is a colossal waste of money at a time when the federal government should be spurring on new energy sources that can power the AI boom and help bring down utility bills.”
Levin’s frustration is echoed by others. The Sierra Club warned that continuing to subsidize coal will lead to “skyrocketing bills,” worse health outcomes, and a “decaying environment.” The Environmental Defense Fund noted that modern clean energy like solar, wind, and battery storage is now cheaper and faster to deploy – the real solution for powering a high-tech economy affordably. Critics argue that pouring more money into coal props up “dirty, uncompetitive plants from the last century” instead of investing in 21st-century energy.
Coal’s decline vs. clean energy’s rise
The backlash is fueled by coal’s sharp decline in the US power mix. Coal generated only about 15% of US electricity in 2024, down from 50% in 2000, according to the US Energy Information Administration (EIA), as cheap natural gas and booming solar and wind power have eaten away coal’s market share. No new US coal plants are planned, and dozens of aging coal plants are slated for retirement in the next few years due to high costs and old age. In fact, wind and solar produced more electricity than coal in the US last year for the first time ever, and the EIA reported last week that wind and solar combined provided 19% more electricity than did coal during the first seven months of 2025.
Against that backdrop, pouring hundreds of millions into coal flies in the face of market trends and climate urgency. Analysts are skeptical that the DOE’s coal push will change coal’s long-term outlook, calling it at best a short-term boost for a “zombie” industry that can’t compete in the long run.
Electrek’s Take
Spending $625 million to revive coal – the dirtiest, most carbon-heavy energy source – is a ridiculous move when clean energy is cleaner and cheaper. It’s an especially hypocritical move given that just last week, Wright canceled $13 billion of funding for renewable energy projects and dismissed renewables’ need for federal subsidies at a press conference, saying:
If you can’t rock on your own after 33 years, maybe that’s not a business that’s going places.
Guess it slipped Wright’s mind that US fossil fuels already receive about $760 billion a year in federal subsidies, according to the International Monetary Fund, after nearly two centuries of government support. And just days later, he’s handing hundreds of millions more in taxpayer dollars to a dying coal industry that isn’t “rocking on its own.”
This hefty taxpayer-funded handout is highly unlikely to reverse coal’s decades-long decline, but it could slow cleaner investments and keep polluting plants on life support. At a time when the government “should be spurring new energy sources to power the AI boom,” funneling money into dirty 19th-century fuel is an embarrassing, damaging throwback.
Read more: The oil shill running the Energy Dept. just banned the words ‘climate change’
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A few years ago, it was basically a Tesla, Nissan Leaf, or Chevy Bolt if you were looking for a used electric vehicle. Nowadays, you can buy used Toyota, Ford, Hyundai, Chevy, or Honda EVs for about the same, or even less than, gas-powered cars.
Is now the time to buy used EVs?
Used EVs are now the fastest-selling cars in the US. A record 40,960 used electric vehicles were sold in the US in August, according to Cox Automotive, up 59% from the same month in 2024.
Despite also hitting a new record in August with 146,332 units sold, new EV sales increased by only 17.7% compared to last year.
With the federal tax credit of $7,500 for new and $4,000 for used EVs set to expire on September 30, buyers are rushing to lock in the savings.
So, why are used EVs flying off the lot compared to new models? For one, there are so many more options to choose from. Used electric vehicles from Ford, Volkswagen, BMW, Toyota, and Honda are starting to appear at dealerships across the US.
In 2022, a flood of new options, like the Ford F-150 Lightning, Toyota bZ4X, Cadillac Lyriq, and BMW i4, launched in the US. Since many buyers opt for a three-year lease, these same EVs are now hitting the used market.
Perhaps, even more importantly, the price is comparable to that of a similar gas-powered car, but it typically offers significantly more.
The price premium over used ICE vehicles is now just $897, the lowest on record. In fact, 14 makes had a lower average EV price than their gas-powered counterpart.
The top five selling used EVs, the Tesla Model 3, Tesla Model Y, Chevy Bolt EV, Tesla Model S, and Ford Mustang Mach-E, were all priced below the market average. Tesla’s Model 3 led used EV sales with an average price of $23,278, while the Nissan LEAF ($12,890) and Chevy Bolt ($14,705) remained the most affordable.
Cox Automotive expects another strong month for both used and new EV sales, with the IRA tax credit expiring at the end of September. How automakers react with price changes and incentives will impact sales through the end of 2025.
Since electric vehicles have fewer moving parts, require little maintenance, and offer more advanced software, safety, and connectivity technology, the new wave of used models may be your best bet for an affordable EV.
With models like the Honda Prologue, Hyundai IONIQ 5, and Chevy Equinox EV leading the way in new EV sales, more used EVs are already starting to hit the market. The top six selling new EVs in August were the Tesla Model Y, Model 3, Honda Prologue, Chevy Equinox EV, Hyundai IONIQ 5, and Ford Mustang Mach-E.
There are still two days left to grab the EV savings. If you’re curious, you can use the links below to see what’s available in your area.
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