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Morning Brief: Trump-Musk Feud Causes Problems for Tesla, Xi Restarts Flow of Crucial Minerals, President Eases Restrictions on US Drones

BY Guy D. McCardle

Welcome to your Saturday morning brief for June 7, 2025. In a week packed with major moves, Trump’s feud with Elon Musk sent Tesla stock tumbling, a rare thaw in U.S.–China trade reopened the flow of critical minerals, and new executive orders cleared the skies for America’s drone industry to take off.

As Trump leans toward renewed trade talks, Xi keeps his poker face—both leaders signaling calm while global markets hold their breath.

Elon Musk picked the wrong fight at the wrong time, and Tesla is paying the price. His public feud with President Trump has turned into a financial and political mess for the company, leaving Tesla more vulnerable than it’s been in years.

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The stock market didn’t hesitate to weigh in. Tesla shares took a historic beating—dropping nearly 14% in one day and wiping out over $150 billion in market value. That’s the biggest single-day loss the company has ever seen. Investors aren’t reacting to production delays or missed earnings; they’re reacting to Musk’s war with the President. The message is simple: go to war with Trump, and don’t expect Wall Street to have your back.

Musk’s real problem isn’t just about bruised egos or nasty tweets—it’s that he’s lost political cover. Tesla used to enjoy friendly policies and hefty subsidies thanks to climate-focused lawmakers. Now, with the Trump administration back in charge and House Republicans on the offensive, those days may be over. They’ve already moved to cut electric vehicle tax credits, battery subsidies, and charging infrastructure funding—programs that have directly benefited Tesla more than any other U.S. automaker.

And it doesn’t stop there. Trump has gone a step further, threatening to pull government contracts and strip away federal support from all Musk’s companies, including Tesla and SpaceX. If that happens, Tesla could be looking at billions in lost revenue. That’s not just a financial headache—it’s a potential existential threat to its long-term plans.

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Meanwhile, Tesla’s sales aren’t doing any favors. The company’s car deliveries dropped 20% in the first quarter. Overall revenue is down 9% year-over-year. Chinese EV makers are gaining ground, and Musk’s increasing political showboating isn’t helping. Protests are cropping up at Tesla locations, and longtime investors are questioning whether Musk’s attention is stretched too thin—or worse, whether he’s now a liability to the brand.

Looking ahead, Tesla’s big bets on autonomous vehicles and robotaxis could also stall out. These projects rely heavily on a cooperative regulatory environment. If the Trump administration decides to dig in its heels, those innovations could get buried in red tape.
The bottom line: Musk’s fight with Trump has created a perfect storm for Tesla. The company is getting hit on all fronts—financially, politically, and reputationally. Unless something changes fast, Tesla’s golden era might be coming to an abrupt and ugly end.

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Xi Restarts Flow of Crucial Minerals

Chinese President Xi Jinping has decided to loosen the grip on rare earth exports to the United States, giving American industries a much-needed breather. After months of Beijing tightening the screws, which rattled everything from car factories to defense contractors, Xi is now allowing shipments of rare earth minerals and magnets to resume—at least temporarily. This shift comes on the heels of a direct conversation with President Trump, where the two leaders tackled rising trade tensions head-on and acknowledged the critical role these materials play in sectors vital to both economies.

As part of the new arrangement, China has granted short-term export permits to suppliers working with America’s three largest automakers. That’s a clear signal Beijing is backing off—at least for now—from the export restrictions that had American manufacturers on edge. It also hints that both countries are willing to return to the negotiating table, with another round of trade talks reportedly set to take place in London.

Still, nobody should mistake this for a permanent solution. China isn’t giving up its leverage. Rare earths are too important, and Beijing’s export licensing system remains firmly in place. These materials are a strategic asset, and the Chinese government knows exactly how to use them in a trade fight. So while this move cools things off for the moment, the long-term future of America’s rare earth supply is still tied to ongoing diplomacy—and whether both sides can stick to whatever deals they strike.

 

Trump Eases Restrictions on US Drones

President Trump has just rolled out a sweeping set of executive orders aimed at overhauling how America handles drones—and the shift is substantial. On one hand, he’s clearing the runway for faster commercial innovation. On the other, he’s putting tougher safeguards in place to protect against misuse. The FAA has been told to speed things up, especially when it comes to letting companies fly drones beyond the operator’s line of sight. That’s a significant breakthrough. It opens the door for things like routine package delivery, infrastructure inspections, and rapid emergency response—areas that were previously choked by outdated regulations.

At the same time, Trump wants to make life easier for American drone manufacturers. His orders cut through the red tape that’s slowed down testing, production, and exports. The message is clear: build them here, fly them here, sell them worldwide. This push is also about shaking off reliance on foreign-made drones—especially those coming out of China. By prioritizing domestic manufacturing, the administration is trying to make sure our skies aren’t filled with tech we can’t fully control.

That doesn’t mean the White House is ignoring the risks. These orders also establish new layers of protection to guard against criminal and terrorist drone use. A federal task force is being formed to tighten security around sensitive areas, from power plants to public events like the Olympics and the World Cup. Real-time drone detection tech is being ramped up, and new laws are on the way to block unauthorized flights near critical infrastructure.

Lastly, Trump’s vision goes beyond just drones. He’s throwing support behind next-gen air tech—things like electric vertical takeoff aircraft (those sci-fi-looking flying taxis) and supersonic jets. The goal is to keep America at the front of the global race in aerospace. Bottom line: this is a two-pronged strategy—clear the path for innovation while slamming the door on threats. And it’s all designed to keep American skies safer and more competitive.

 

 

 

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