The feud between Elon Musk and President Donald Trump has entered a new phase—and investors are already weighing the ripple effects across industries.
Tesla shares fell sharply Monday after Musk announced the launch of a new political party, while space rival Rocket Lab emerged as an unexpected beneficiary.
Tesla stock was down 6.6% in premarket trading, slipping to $294.41 after Musk declared the formation of the “America Party” to challenge both Republicans and Democrats.
The move followed his public criticism of Trump’s sweeping tax and spending bill, which Musk said would worsen the nation’s debt burden.
President Trump fired back on Truth Social, saying Musk had gone “completely off the rails.”
While the broader markets dipped slightly—S&P 500 and Dow Jones futures fell 0.3% and 0.1%—Rocket Lab shares surged 4.1% in premarket trading.
Rocket Lab, other rivals gaining from political fallout
Rocket Lab isn’t alone in seeing short-term benefits.
Other competitors to Musk’s sprawling corporate empire also posted modest gains.
AST SpaceMobile, which aims to rival Musk’s Starlink satellite internet system, rose 2.1% and is up 46% over the past month.
The driver behind these moves isn’t just political theater.
Musk’s fallout with Trump could imperil future federal contracts for companies like SpaceX, especially as the Department of Defense and NASA continue awarding billions in new projects.
Rocket Lab, already seen as a rising player in aerospace and defense, may be poised to capture some of that business.
Defense milestone adds fuel to the RKLB rally
Rocket Lab’s strength isn’t just political.
The company recently completed the Critical Design Review (CDR) for the Space Development Agency’s T2TL-Beta constellation—a key milestone that clears the path for the full-scale production of 18 spacecraft.
The project is part of the Department of Defense’s Proliferated Warfighter Space Architecture, aimed at building resilient, low-latency communications networks in Low Earth Orbit.
Rocket Lab will deliver the spacecraft using its Lightning platform, a vertically integrated design that allows the company to manage everything from avionics to solar panels and flight software in-house.
Electron launch pace breaks records
Operational momentum is also high.
Rocket Lab’s Electron rocket has now completed 10 successful launches in 2025 alone, including four in June.
A recent back-to-back launch within 48 hours from its New Zealand site marked a new record for turnaround time.
The company’s 100% mission success rate this year underlines its increasing reliability—a key concern for commercial clients and defense partners alike.
Neutron rocket on deck
All eyes now turn to Rocket Lab’s next major milestone: the debut of Neutron, its reusable medium-lift rocket designed to compete directly with SpaceX’s Falcon 9.
CEO Peter Beck told CNBC last week that the company remains on track to launch Neutron in the second half of 2025.
If successful, Neutron could vastly expand Rocket Lab’s addressable market, enabling it to support larger payloads and higher-value missions.
Beck also highlighted the company’s recent acquisition of Geost, a space-based sensing firm, as part of a broader push to offer end-to-end satellite and launch services.
Analysts bullish, technical levels supporting optimism
Analysts are increasingly bullish. Cantor Fitzgerald raised its price target earlier this month, citing Rocket Lab’s consistent execution, growing backlog, and near-term catalysts.
Several other analysts have echoed similar sentiments, noting RKLB’s differentiated business model and increasing relevance in defense and commercial space markets.
Technically, after consolidating for several weeks just below the key $30 resistance level, the stock has now broken through and is trading comfortably above it.
Going forward, traders and investors will monitor the $30 mark closely, watching to see if it establishes itself as a new support level.
An inflection point for Rocket Lab
Rocket Lab’s transformation from a niche launch startup into a full-spectrum space infrastructure provider appears to be gaining critical mass.
With government contracts in hand, a maturing manufacturing base, and a game-changing rocket on the horizon, the company is entering a new phase.
While its over 600% gain over the past year has raised questions about valuation, many investors see more upside ahead—especially if the political fallout from Musk’s break with Trump continues to shape procurement dynamics in the aerospace sector.
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