Elon Musk allegedly tried to convince President Donald Trump to change his mind about imposing large new taxes (called tariffs) on goods imported from China. Musk did this both privately, by talking directly to Trump, and publicly, by criticizing the tariffs on social media. Musk was against these tariffs because they could hurt Tesla, his electric car company, which builds and sells cars in both the U.S. and China.
The tariffs would make Tesla’s products more expensive and could weaken its ability to compete worldwide. According to the Washington Post, Musk’s private efforts to influence Trump didn’t work. Even though Trump was reportedly willing to negotiate some parts of his tariff plan, he still went ahead with raising taxes on Chinese imports to 50%, on top of an earlier 34% increase. Musk also spoke out against the tariffs in public.
He posted a video to X of economist Milton Friedman talking about why free trade is good, hinting that he disagreed with Trump’s policies. He also criticized Peter Navarro, a White House advisor who strongly supported the tariffs, by questioning Navarro’s knowledge of economics on social media. This public disagreement made tensions worse between Musk and Navarro, showing that even Trump’s own team was divided on trade policy.
Trump continues with Tariffs despite opposition
The stock market reacted badly to Trump’s tariffs. The S&P 500 dropped into a bear market (meaning stocks were down significantly), and many stocks became unstable. Investors were worried that the tariffs could start a global trade war and hurt the economy. This made Musk even more concerned because Tesla was already facing weaker sales, and the tariffs could make things worse.
Other business leaders also spoke out. Economic Times reported that Joe Lonsdale, an investor connected to Musk, publicly said the tariffs would harm American companies.
Inside the Trump administration, there were different opinions on tariffs. While Navarro pushed for strict trade restrictions, others, like Treasury Secretary Scott Bessent, were more open to compromise. This disagreement made it harder for business leaders to convince Trump to soften his stance. Even Commerce Secretary Howard Lutnick, who had once been seen as an ally to Musk, started supporting tariffs, making it tougher to change Trump’s mind.
The conflict between Musk and Trump also revealed growing tension between Silicon Valley leaders and the Trump administration. This was especially important because Musk was about to leave his advisory role in Trump’s government.
Tesla’s stock took a big hit after the tariff announcement, dropping more than 2.5% in one day and losing over 38% of its value since the start of the year. Some analysts said this was partly because Musk’s political statements were hurting Tesla’s reputation. Later, Musk seemed to back down slightly, saying there were some “good points” in a statement from the U.S. Trade Representative defending the tariffs.
Published: Apr 8, 2025 09:00 am