Tesla (TSLA) CEO Elon Musk, one of Donald Trump’s biggest supporters during his election campaign, got into a heated argument with the President on Thursday. The tension in question had a very negative impact on markets already shaken by the tariff agenda. Tesla shares closed Thursday down 14%.

Elon Musk and Trump, who have been on camera friendly since US President Donald Trump took office in November, seem to be on the verge of breaking their strong bond. Trump threatened Musk on Thursday to end the CEO’s government contracts with his companies, while the world’s richest man suggested that the US president should be impeached. This incident caused an unexpected alliance to end abruptly, leaving viewers wondering what will happen next.

The feud between the former allies escalated when the president criticized Tesla CEO Musk in the Oval Office, and the two later traded verbal attacks, but in their own niches: Trump’s Truth Social and Musk’s X.

The masses who follow the tension on social media simultaneously between the two platforms have also seen their investments hit. Tesla shares fell 14% on Thursday, wiping $150 billion off its market value. That was Tesla’s biggest single-day loss in history. But the shares rebounded on Friday, rising 4% in premarket trading.

The problems between the two began a few days ago when Musk condemned Trump’s sweeping tax cut and spending bill. The president campaigned to torpedo Musk’s bill, initially remaining silent, saying it would add too much to the nation’s $36.2 trillion debt.

Trump broke his silence on Thursday, telling reporters that he was “very disappointed” in Musk. “Look, Elon and I had a great relationship. I don’t know if we’re going to have that anymore.” Trump made those comments on Truth Social, while Musk responded in real time on X.

Trump, who praised the Tesla CEO at a private reception last week to celebrate Musk’s departure from the Department of Government Efficiency (DOGE), said on Truth Social yesterday, “The easiest way to save billions of dollars in our budget is to terminate Elon’s government subsidies and contracts.”

Minutes after the closing bell, Musk replied “Yes” to a post on X that Trump should be impeached — an unthinkable move in Congress, where Trump’s Republicans hold the majority in both chambers. In another post, Musk claimed that the tariffs Trump signed would push the U.S. into recession later this year.

Musk, who gave around $300 million in support to Trump and other Republicans in last year’s election, wrote, “Trump would have lost the election without me.” Trump responded by saying, “Elon was losing his patience, I told him to leave, I took away the EV mandate that forced him to buy electric cars that no one wanted (he knew I would do this months ago!) and he went crazy.”

In a move that took the incident to a whole new level, Musk shared, “Time to reveal the big truth. @realdonaldtrump is in the Epstein files. This is why the files are not public. Good day, DJT!” The discussion quickly turned into a verbal spat, which caught the attention of the media as well as the markets and investors. The discussion, which started with the White House’s budget proposal, quickly moved from Trump’s presidency to tariffs and companies owned by Musk.

Musk’s businesses include rocket company and government contractor SpaceX and satellite unit Starlink. Musk, whose space work plays a critical role in the US government's space program, said he would begin retiring SpaceX's Dragon spacecraft following Trump's threats.

This was a significant threat, as Dragon is the only US spacecraft capable of sending astronauts to the International Space Station. However, Musk has since backed off on the threat. In a possible sign of a thaw, Musk responded to billionaire investor Bill Ackman’s suggestion that Trump and Musk should make peace by writing, “You’re not wrong.”

Trump and Musk are political warriors who tend to use social media to attack perceived enemies, and many observers had predicted a rift between them. Musk became one of Trump’s most visible advisers as the head of the Department of Government Productivity, which launched a sweeping and controversial effort to shrink the federal workforce and cut spending.

Since leaving that post, Musk this week took aim at what he called Trump’s “big, beautiful bill,” calling it a “terrible move” that would deepen the federal budget deficit. His attacks have deepened a divide within the Republican Party that could threaten the bill’s chances of passing in the Senate. Independent analysts say Trump’s bill could add $2.4 trillion to the nation’s $36.2 trillion debt by $5 trillion.

The long-running feud between the two could make it harder for Republicans to maintain their majority in Congress in next year’s midterm elections if it leads to Musk’s campaign spending being cut or support for Trump waning in Silicon Valley. “Elon played a really important role in the last campaign. If he doesn’t run in the midterms, that would worry me,” a Republican strategist with ties to Musk and the Trump administration told Reuters on condition of anonymity.

On Tuesday, Musk posted a message saying, “We will fire all the politicians who have betrayed the American people in November.” Musk has previously said he plans to cut back on his political spending in the future. Musk’s increased involvement in politics has led to widespread protests at Tesla facilities, hurting sales and raising concerns that he is too distracted.