Billionaire entrepreneur Elon Musk has officially launched a new political organization called the America Party, marking one of the most dramatic shake-ups in the U.S. political landscape in recent years. The announcement triggered an immediate and sharp backlash from President Donald Trump, deepening an already escalating rift between the two high-profile figures.
On July 5, Musk unveiled the America Party through a series of posts on X (formerly Twitter). He described the new movement as a challenge to what he called the “Democrat-Republican uni-party,” promising to restore individual freedoms and prioritize “common-sense governance.”
Musk stated that the America Party plans to participate in the 2026 midterm elections and will focus on replacing lawmakers who supported Trump’s recently passed “Big, Beautiful Bill,” a sweeping tax-and-spending package that Musk has criticized as reckless and harmful to economic stability.
“We need a political alternative that puts people over parties and breaks the current two-party monopoly,” Musk wrote. He also emphasized that the party would seek to attract Americans who feel unrepresented by either major party.
Responding on July 6 before boarding Air Force One, Trump called Musk’s move “ridiculous” and warned that third-party efforts historically fail in the U.S.
“I think it’s ridiculous to start a third party. It just confuses voters and divides support. Third parties have never worked,” Trump told reporters.
Later that day, Trump escalated his comments on Truth Social, referring to Musk as “a train wreck” and accusing him of undermining conservative unity. Trump also threatened to reconsider federal contracts and subsidies currently supporting Musk’s companies, including Tesla and SpaceX.
Investor and Market Reactions
Following Musk’s announcement, Tesla shares fell nearly 7% in pre-market trading on July 7, reflecting investor anxiety over Musk’s growing political ambitions and their potential impact on his corporate responsibilities.
Investment firm Azoria Partners announced it was postponing the launch of a Tesla-focused ETF, citing governance concerns and Musk’s political distractions.
Historical Context and Political Impact
The launch of the America Party represents the latest break in Musk and Trump’s previously cooperative relationship. In 2024, Musk supported Trump’s re-election bid and led the Department of Government Efficiency (DOGE), a role in which he advocated for federal spending cuts and deregulation.
Musk has stated that his new party seeks to represent the “80% of Americans stuck in the middle” and hinted at possible collaboration with other alternative movements, such as Andrew Yang’s Forward Party. However, he has not yet provided detailed policy proposals or named specific candidates.
Political analysts have noted that while third parties in the U.S. historically struggle to gain traction, Musk’s financial resources and massive social media reach could make the America Party a disruptive force in upcoming elections.
It remains unclear how far Musk’s political ambitions will reach and whether the America Party can secure significant support. Meanwhile, Trump and his allies are expected to continue efforts to consolidate Republican support ahead of the 2026 midterms.
