Elon Musk loses $12,000,000,000 in one day amid Trump feud and Tesla crash — here's what caused second-biggest wealth wipeout in human history
On July 1–2, 2025, the world's richest man, Elon Musk, lost a staggering $12 billion in a single day. The massive drop in his net worth was largely triggered by a sharp fall in Tesla's stock price, following an escalating public dispute with President Donald Trump. According to the Bloomberg Billionaires Index, Musk's fortune dipped from around $367 billion to $355 billion—a 3.3% one-day decline, making it the second-largest personal wealth loss in human history.
What caused Elon Musk's net worth to fall by $12 billion?
The sharp fall in Elon Musk's net worth came after Tesla stock tumbled over 6–7% on July 1, 2025. The decline followed Donald Trump's public threats to strip Tesla of federal electric vehicle (EV) tax credits, which are worth an estimated $2.8 billion, and cut off SpaceX's government contracts, valued at $22 billion, if Musk didn't tone down his criticism of Trump-backed legislation.
This high-stakes political clash rattled investors and dragged down Tesla's market capitalization by approximately $150 billion. Since Musk owns a massive share in Tesla, the dip wiped $12 billion from his personal wealth almost instantly.
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How does this loss compare to Musk's past wealth swings?
Musk is no stranger to massive wealth fluctuations. Just a few weeks earlier, on June 6, 2025, he lost $33.9 billion in one day after another heated moment in the ongoing feud with Trump caused a 14% drop in Tesla's share price.
Although the recent $12 billion fall is smaller in comparison, it still ranks as one of the biggest single-day wealth losses in history. Musk's fortune has been extremely sensitive to Tesla's stock movement, and the current political uncertainty has amplified that volatility.
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What's Elon Musk's current net worth and how has it changed?
As of June 30, 2025, Elon Musk was worth around $367 billion, per the Bloomberg Billionaires Index. After the drop, his net worth now stands at roughly $355 billion to $356 billion.
Let's break it down:
Peak net worth:
$439 billion in December 2024
Current net worth (after July 1–2 drop):
~$355 billion
Total decline since peak:
Over
$70 billion
Single-day loss (July 1):
$12 billion (~3.3%)
Why does Elon Musk's fortune swing so wildly?
Musk's wealth is mostly tied up in Tesla and SpaceX stock. Though he doesn't take a salary from Tesla, he earns stock awards based on performance. When Tesla stock surges, so does Musk's net worth—and vice versa.
His investments are spread across several companies:
Tesla
: Main source of net worth
SpaceX
: Over 20% of his fortune
xAI, X (formerly Twitter), Boring Company
: Smaller shares
Government contracts and subsidies
: Crucial for both Tesla and SpaceX
Even minor shifts in Tesla's stock can lead to
multi-billion-dollar gains or losses
for Musk in a single day.
What triggered the feud between Elon Musk and Donald Trump?
Tensions between Musk and Trump have been rising for months. It began when Musk openly criticized Trump's legislative priorities, including what he called the 'Big Beautiful Bill.' In response, Trump began hinting at removing federal support for Musk's companies, which led to sharp drops in Tesla's stock on multiple occasions.
Trump's threat to cancel EV tax credits—a key selling point for Tesla buyers—could reduce Tesla's revenue by an estimated $1.2 billion annually. The risk of losing major SpaceX contracts with the U.S. government only adds to the uncertainty.
What are analysts saying about Tesla's future?
Despite the political storm, analysts at
Wedbush Securities
still have a positive outlook. They've set a
price target of around $500
for Tesla, betting that the company will bounce back once tensions ease and delivery numbers for the second quarter are finalized.
Meanwhile, others caution that Musk's increasing entanglement in politics could hurt investor confidence and expose his companies to long-term risk. A financial analyst told Axios,
'At the end of the day, being on Trump's bad side will not turn out well—especially when federal contracts and tax credits are involved.'
Will Musk recover from this loss?
It's not the first time Elon Musk has seen his wealth fluctuate drastically. In 2020, his net worth was under $30 billion, and by late 2021, it had surged to over $340 billion. His fortune reached an all-time high of $439 billion in December 2024, after Tesla shares jumped post-Trump reelection.
Though his net worth is down over $70 billion since that peak, Musk still sits comfortably at the top of the billionaire list, with Jeff Bezos and Mark Zuckerberg trailing behind at $353 billion and $244 billion, respectively.
Musk's empire remains vast—Tesla, SpaceX, xAI, The Boring Company, and X—and he's likely to recover, especially if market conditions improve and political pressure eases.
Elon Musk Net Worth– Data Table
Category
Details
Current Net Worth (July 2025)
$367 billion
Net Worth Peak (Dec 2024)
~$439 billion
Pandemic Start Net Worth (2020)
Just under $30 billion
Nov 2021 Peak
~$340 billion
Pre-election Net Worth (Oct 2024)
~$290 billion
Post-Trump Re-election Surge
~$400 billion (briefly)
Net Worth Loss Since Peak
~$70+ billion
Major One-Day Loss (June 2025)
$12 billion
What does this mean for Musk—and for investors?
This $12 billion loss is a reminder of how closely tied Musk's wealth is to political and market forces. Tesla's reliance on federal subsidies, especially EV tax credits, exposes the company to risk when political winds shift.
For now, Elon Musk remains the richest person in the world, but the fight with Trump has clearly shaken investor confidence. As more details unfold—and if the Trump administration follows through on threats—Musk's financial rollercoaster may not be over yet.
FAQs:
Q1. Why did Elon Musk lose $12 billion in one day?
Because Tesla's stock crashed after Trump threatened EV credits and SpaceX deals.
Q2. What caused Elon Musk's second-biggest wealth loss?
A political fight with Trump and falling Tesla shares.
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