President Donald Trump said Thursday that he wants Elon Musk’s companies to “thrive”—a sharp turnabout just one day after the White House expressed doubt about whether Musk’s artificial intelligence company, xAI, should continue receiving government contracts. “Everyone is stating that I will destroy Elon’s companies by taking away some, if not all, of the large scale subsidies he receives from the U.S. Government. This is not so!” Trump posted on his Truth Social platform. “I want Elon, and all businesses within our Country, to THRIVE, in fact, THRIVE like never before!” It was the latest twist in the Trump-Musk rollercoaster—one that’s swung between public threats and awkward praise since their breakup in June. Just a day earlier, White House press secretary Karoline Leavitt was asked whether Trump wanted xAI to get federal contracts. “I don’t think so, no,” she replied. Leavitt added that she’d check with the president about possibly canceling existing deals, including one between the Department of Defense and xAI that is worth up to $200 million. It wasn’t just xAI under scrutiny. Reuters reported earlier this week that the administration is exploring alternatives to Musk’s SpaceX for work on the Golden Dome missile defense system—another sign that Musk’s hold on federal funds may be slipping. A person protesting Elon Musk’s actions in the Trump administration holds a sign outside a Tesla showroom in Seattle on Feb. 13. This wouldn’t be the first time Trump has threatened to pull the plug. Back in June, he floated the idea of gutting Musk’s funding entirely. “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts,” Trump posted online. He also took a swipe at Musk’s political ambitions earlier this month, calling his newly launched political party, the “America Party,” “ridiculous.” (He’s not wrong there.) “It’s ridiculous to start a third party,” Trump told reporters. “We have a tremendous success with the Republican Party. The Democrats have lost their way, but it’s always been a two-party system, and I think starting a third party just adds to confusion.” Now Trump may be walking it all back. His latest Truth Social post came just days after The Wall Street Journal reported that the Justice Department had told Trump he was mentioned in the Epstein files—something Musk had publicly claimed during their spat. Since The Journal’s report, Musk hasn’t mentioned it again. The timing didn’t go unnoticed. Trump’s administration is already facing heat over its handling of Epstein-related documents, and Musk has been a loud amplifier of the controversy. The two have been trading shots since late May, when Musk’s stint as a special government employee ended and he quickly began slamming Trump’s tax-and-spending agenda. Things escalated quickly—Musk accused Trump of ties to convicted sex offender Jeffrey Epstein, and Trump responded by threatening to cut Musk’s contracts and subsidies. Before the fallout, Musk wasn’t just an ally—he was also at the helm of Trump’s so-called Department of Government Efficiency, and he’d pumped hundreds of millions into Trump’s reelection campaign. In March, Trump even promoted Teslas from the White House lawn like a QVC host, urging Americans to buy Musk’s cars. He even bought one—though after their fallout, he claimed he was considering tossing it. Still, if Musk was hoping for a win, Thursday didn’t bring it. According to Axios, Tesla shares dropped 9% in mid-morning trading after the company reported weak earnings and warned that Trump’s tax bill could hurt future results. Also, on a Wednesday earnings call, Musk predicted Tesla would face “a few rough quarters” due to rising tariffs and other factors. Now the ball’s in Musk’s court: Does he accept the olive branch—or strike again?
