Many Wall Street analysts believe that if the large-scale tax and spending bill dubbed "Big, Beautiful Bill" promoted by the Trump administration is ultimately enacted, tesla could face multifaceted impacts.

Just days ago, Musk officially left the "Office of Government Efficiency," concluding his tenure in the White House. Over the past few weeks, despite visible disagreements with other officials, both Trump and Musk have tried to present a united front, insisting that their relationship remains stable.

White House Press Secretary Caroline Levitt stated at a briefing that Trump had long been aware of Musk's stance on the spending bill, but Musk's criticism would not alter Trump's position.

For Musk's companies, the bill could be a double-edged sword: While firms like SpaceX and xAI might benefit from the massive spending package, Tesla- his highest-valued company- could suffer significant, wide-ranging losses.

According to the Republican bill, the electric vehicle (EV) tax credits introduced under the Biden administration would undergo major changes. Currently, under Biden's policy, consumers can receive up to $7,500 in tax credits for new EV purchases and $4,000 for used EVs.

However, the Republican bill would drastically cut the "Clean Vehicle Credit." If passed into law, automakers that have sold more than 200,000 eligible EVs between December 31, 2009, and December 31, 2025, would no longer qualify for the credit.

In Q1 2025 alone, Tesla delivered over 336,000 vehicles. Musk has previously argued that eliminating the tax credit would devastate Tesla's competitors, and while it would also hurt Tesla, the long-term effect might ultimately benefit the company.

Morningstar equity strategist Seth Goldstein disagrees. He told media outlets that scrapping the EV tax credit "would be the biggest factor impacting Tesla," leading to a decline in sales- a sector where Tesla has already been struggling.

JPMorgan analyst Ryan Brinkman wrote in a report that the "Big, Beautiful" bill, along with other proposed legislation (including dismantling the California Air Resources Board), could threaten more than half of Tesla's 2025 profits.

Brinkman explained that the $7,500 tax credit accounts for about 19% of Tesla's 2024 EBIT, and its elimination poses a $1.2 billion risk to profits. Terminating California's Zero-Emission Vehicle (ZEV) credit sales program could add another $2 billion in losses.

Currently, Tesla is heavily betting on AI and robotics, hoping to achieve full self-driving (FSD) technology through its upcoming robotaxi service- a move Musk has called critical to boosting the company's valuation.

Brinkman noted that Tesla's robotaxi business may take years to generate meaningful revenue, while the impact of losing EV subsidies would hit hard in 2025 and 2026.

He expects Wall Street to revise Tesla's earnings estimates downward as the implications of the Trump administration's EV credit repeal become clearer. That said, some consumers may rush to buy Teslas before the credits expire, providing a short-term sales boost.

Goldstein, however, believes the removal of tax credits could "accelerate" Tesla's shift toward becoming an AI and robotics company.

Notably, the current draft of the "Big, Beautiful" bill also introduces a new fee: a $250 annual charge for EV owners and $100 for hybrid vehicle users, to be collected by the Federal Highway Administration.

Additionally, the Republican spending bill threatens Tesla's energy storage business by eliminating tax credits for consumers on storage systems. Wedbush analyst and prominent Tesla bull Dan Ives acknowledged this would negatively impact Tesla.