Britain’s largest publicly traded defense contractor has experienced a £2 billion loss following investor concerns that Elon Musk’s efficiency initiative may lead the U.S. government to reduce military expenditures.

On Friday, BAE Systems’ shares saw the most significant drop in the FTSE 100 index after Bank of America analysts expressed “increasing uncertainty” regarding the implications of a program aiming for at least $2 trillion in federal spending reductions.

Elon Musk, the CEO of Tesla, has been appointed as an advisor in the administration of President-elect Donald Trump, with the goal of “overhauling government bureaucracy, reducing excessive regulations, eliminating wasteful spending, and reorganizing federal agencies.”

According to Bank of America’s analysts, led by Benjamin Heelan, this reduction in spending might result in “contract modifications” affecting BAE Systems, which generates approximately 40% of its £10.7 billion revenue from the U.S. market.

“The emphasis on budget efficiency introduces uncertainty which may impact valuations,” the analysts indicated. They lowered BAE’s rating from “neutral” to “underperform,” which is typically the second lowest mark prior to the designation of “sell.”

BAE’s shares, previously among the top performers on London’s blue-chip index this year due to increased geopolitical tensions, fell by 4.9%, or 63p, closing at £12.27, resulting in a loss of about £2 billion from its total £37 billion market capitalization.

QinetiQ Group, a defense contractor listed on the FTSE 250, was also downgraded by Bank of America, the second-largest bank in the U.S. The analysts noted, “While we don’t think this impacts QinetiQ’s midterm growth prospects, it does indicate a less favorable environment for defense. “

Shares in QinetiQ, which earns 21% of its revenue from the U.S., have risen over a third this year but saw a 3.5% drop, closing at 415p.

Additionally, Goldman Sachs analysts observed that with the U.S. defense budget at a historic peak, initiating significant government spending reductions without affecting defense would be challenging.

This downturn in share prices follows a period of rising values for UK defense stocks following conflicts in Ukraine and the Middle East. Earlier this year, BAE announced a record order book totaling £69.8 billion amid worldwide rearmament initiatives.