Trump Threatens to Axe Elon Musk’s Billions in Federal Contracts Amid Public Fallout

The high-profile alliance between President Donald Trump and Elon Musk has erupted into a bitter feud, with Trump now threatening to cancel billions of dollars in federal contracts tied to Musk’s businesses.

Posting on Truth Social on June 5, Trump called for the termination of what he described as “Governmental Subsidies and Contracts” benefiting Musk. “The easiest way to save money in our Budget… is to terminate Elon’s Governmental Subsidies and Contracts,” Trump wrote. “I was always surprised that Biden didn’t do it!”

The feud comes as Musk, a former top Trump adviser and head of the now-defunct Department of Government Efficiency (DOGE), intensifies efforts to block Trump’s controversial tax and policy bill. Trump claimed he had asked Musk to leave his White House role, accusing the billionaire of pushing unwanted electric vehicle mandates.

“Elon was wearing thin,” Trump stated. “I took away his EV Mandate… and he just went CRAZY!”

In response, Musk announced via X (formerly Twitter) that SpaceX would begin decommissioning its Dragon spacecraft, a vehicle critical to U.S. space operations. “In light of the President’s statement… @SpaceX will begin decommissioning its Dragon spacecraft immediately,” Musk wrote.

SpaceX currently holds around $22 billion in U.S. contracts, with $15 billion from NASA and the rest from defense launches and classified missions. Musk’s other ventures, including Tesla and AI startup Grok, have also benefited from government relationships and funding over the years — totaling over $38 billion in contracts, loans, and subsidies, according to a Washington Post analysis.

Recent reports revealed that Musk’s DOGE team had begun deploying his Grok AI tool to analyze federal data and that SpaceX was in the running to build part of Trump’s proposed “Golden Dome” missile defense system.

Their fallout turned personal. Trump expressed disappointment over Musk’s opposition to his bill, while Musk retorted that Trump wouldn’t have won the 2024 election without his support — pointing to a $250 million campaign donation.

“Without me, Trump would have lost the election,” Musk posted. “Such gratitude.”