Elon Musk’s Fight With Trump Threatens $48 Billion in Government Contracts

Elon Musk’s business empire, including SpaceX, Starlink, and Tesla, collectively stands to lose at least $48 billion in sales over roughly the next decade if President Donald Trump acts on his veiled threat to cancel the companies’ contracts with the US government, according to a WIRED review of publicly available data. Amid growing criticism from Musk on Thursday about the federal budget, Trump said that “the easiest way to save money” would be “to terminate Elon’s Governmental Subsidies and Contracts.”

The federal government typically retains sweeping authority to terminate contracts “for convenience,” a catchall term that can include budget constraints or shifting priorities. But in practice, severing ties with Musk’s companies would be far from simple, carrying serious consequences for the US across areas like defense, space, and transportation.

Musk and Trump have been publicly sparring over a spending bill moving through Congress and supported by the president. The legislation, known as the One Big Beautiful Bill Act, advances Trump priorities such as cutting taxes and bolstering funding for border security, but it would also add $3 trillion to the national debt, according to an official estimate.

Musk has warned that the government’s ballooning debt will push the country into “de facto bankruptcy.” In total, the government’s outstanding contracts with SpaceX and Tesla amount to about 2 percent of the projected deficit from the new spending bill.

Many observers predicted that Musk’s financial support for Trump’s reelection campaign and his role as an adviser to the White House would be a boon for ventures such as SpaceX, which has long done work for the US government. But now, the deteriorating relationship has become a significant business liability.

Opportunities may disappear for Space’s Starlink internet service to do work overseas, Tesla to provide armored vehicles to the State Department, and Musk-founded Boring Company to potentially help drill an Amtrak train tunnel. Tesla shares fell over 14 percent on Thursday, wiping out $152 billion from the company’s market cap, though the stock has since partially recovered.

If Trump seeks further retribution for Musk’s attacks, federal government investigations and potential litigation into his companies could cost the billionaire at least $2.37 billion in purported penalties, congressional estimates from January show.

Musk and the White House did not immediately respond to requests for comment on Friday.

Most of Musk’s work for the government is through his private space technology company SpaceX, which launches rockets and also sells satellite-based internet. Besides NASA, the US military heavily depends on SpaceX to help launch satellites into orbit for secure communications, spying on enemies, and GPS functioning.

In the coming years, SpaceX is slated to directly collect about $34 billion from NASA and the US military for rocket-related projects. The estimate includes the maximum amount of unpaid but contracted funds, according to summaries the US government posts online.

The data show the US is also on the hook for about $14 billion for SpaceX’s Starlink internet service at numerous offices, such as a Department of Interior facility in Nevada.

The data could be outdated or include errors, but many of the listed figures line up with press releases from agencies such as the US Space Force. Some of the funding is subject to congressional approval, and a portion could end up going to SpaceX’s rivals.

But SpaceX’s competitors have faced numerous technical setbacks, and Musk’s company remains the dominant market leader. The billionaire said this week that SpaceX would earn about $15.5 billion in revenue this year, nearly double estimates from two years ago. SpaceX has accounted for 134 of the 166 orbital launches in the US so far this year, according to tracking by Jonathan McDowell, an astrophysicist at the Harvard-Smithsonian Center for Astrophysics.

WIRED didn't review detailed contracts or search for deals the government may have struck with Musk's companies through intermediaries. For instance, some government agencies may be buying ads on Musk’s X social media platform through advertising agencies.

The government’s vehicle fleet includes Tesla electric vehicles, according to documents online, and the General Services Administration recently paid the company for maintenance.

But the GSA’s annual Federal Fleet Report doesn’t break down the number of vehicles by manufacturer or offer details on future spending. The report lists 7,706 battery-electric vehicles in the government fleet. Earlier this year, the Trump administration paused orders for new zero-emission vehicles, dealing a blow to companies such as Tesla.

Musk’s companies have benefited from government support for years. In February, an analysis by The Washington Post found Musk businesses had received at least $38 billion since 2003 in government contracts, loans, subsidies and tax credits across the US, including at the state and local levels. A New York Times analysis from October identified at least $15.4 billion in federal government contracts over the past decade for Tesla and SpaceX.

But Musk himself has tried to take a chain saw to federal spending through his work leading the Trump administration’s Department of Government Efficiency, which claims to have saved $180 billion since January, including by canceling contracts, though that figure remains highly disputed.

Some of DOGE’s efforts were temporarily blocked by the federal courts and also drew protests from federal labor unions, public activists, Congress, states, and even Trump’s own aides and cabinet secretaries. Last month, Musk said he was stepping away from DOGE work to focus on his companies.

Trump’s cost-cutting initiatives haven’t stopped, though. Hiring freezes remain in effect, and the importance of stretching each dollar further is being emphasized more than ever at many federal agencies, according to representatives at two companies with major government contracts. They declined to be named out of fear of retribution from Trump.