Tesla boss Elon Musk at a Trump election rally.
AFP via Getty Images
Elon Musk’s popularity and wealth rests on his willingness to make dangerous bets with SpaceX and Tesla many years ago. Nothing seemed riskier than his high-profile, high-dollar bet that Donald Trump would win the presidency. And like those previous gambles, this one is more likely to repay by making him the brand new administration’s most influential executive – and even richer.
Already the world’s richest person, Musk’s net value grew by $21 billion to $285.6 billion on Wednesday as Tesla shares rose 15% following news of Trump’s victory. The stock closed at $288.53, its highest level in greater than a yr. SpaceX, his rocket company that has turn into essential to NASA and Defense Department launches, is predicted to turn into a good larger beneficiary of federal contracts from a Trump administration, which might further boost Musk’s wealth.
The impact of his support goes beyond the short-term financial gains from his Tesla shares. Trump has said he wants him to function an adviser on government efficiency in his recent administration, which at the least suggests that rules and regulations for giant firms, especially those he favors, will likely be way more relaxed.
“He is a special guy. He’s a super genius,” Trump said of Musk in his victory speech on Wednesday. “We must protect our geniuses. We don’t have that many of them. We have to protect our super geniuses.”
“Elon Musk is not just any billionaire and he is not like most billionaires who try to get into politics.”
While his relations with Biden have been frosty and Musk was snubbed early on for not attending White House events focused on electric vehicle makers, things are expected to alter dramatically in the brand new administration. Musk, who has never been a serious campaign donor up to now, donated around $120 million to Trump and Republican candidates through his America PAC, held a controversial money raffle for voters in swing states to support his preferred candidate, and made quite a few appearances public appearances at Trump rallies in the ultimate weeks of the election campaign. He did so despite multiple consumer surveys showing that these measures are unwelcome amongst Tesla’s core buyer base, which largely identifies as climate-conscious consumers.
“Elon Musk is not just any billionaire and he is not like most billionaires who try to get into politics,” said Michael Morris, a professor of leadership at Columbia Business School. “Although there is a risk of conflict of interest should he hold an official role, “I believe Musk’s motivations are generally not profit-oriented.” I mean, he takes over firms because he believes they’ll change the long run of humanity .
Tesla faces a lot of ongoing reviews from federal regulators, including the National Highway Traffic Safety Administration, over accidents involving its Autopilot and Full Self-Driving features, lots of which have resulted in fatalities. Tesla’s manufacturing operations have been investigated by the Occupational Health and Safety Administration and the Environmental Protection Agency for workplace hazards and industrial pollution. And the Securities and Exchange Commission, which previously sanctioned Musk for false tweets about taking Tesla private, is currently coping with it Look for brand new punishments against the billionaire for failing to testify within the investigation into his $44 billion Twitter takeover. In Texas, SpaceX’s massive launch facility was also recently fined $140,000 for violating groundwater regulations.
Tesla recalled tons of of 1000’s of vehicles within the US in February over an issue with its Full Self-Driving software that could lead on to an accident.
Los Angeles Times via Getty Images
“America is a nation of builders,” Musk said on X, formerly Twitter, after a Trump victory became apparent. “Soon you’ll be free to build.”
While it’s unclear whether a father of 11 who runs several firms along with Tesla and SpaceX, including xAI, The Boring Co. and Neuralink, can land a job with the Trump administration, some Tesla investors are excited. Ross Gerber, president of Los Angeles-based investment firm Gerber Kawasaki, expects Musk will push for fewer regulations — and his firms and others should broadly profit.
“It’s just good,” said Gerber, whose fund holds about $60 million in Tesla shares. “Do you realize how much money and time firms spend just coping with silly document requests asking for nonsense that the regulators themselves don’t know what they’re talking about? It goes on and on and on.
But he’s unsure if Musk will work to influence Trump’s policies on electric vehicles and trade tariffs, which might result in significant cost increases for Tesla vehicles, that are made with quite a few imported parts and materials.
“It depends on whether Trump wants to listen to anyone,” Gerber said. “Elon has a particularly delicate balance between the nations he must accommodate, including China. It’s a very delicate dance that he may or may not do well.”
Musk’s changing priorities, steering Tesla toward robotaxis, robotics and AI and seemingly abandoning his previous climate concerns, are also more likely to profit the subsequent administration.
Trump will likely have an “overall negative impact on the EV industry as the EV rebates/tax incentives are likely to be eliminated. However, we see this as extremely positive for Tesla,” equity analyst Dan Ives, an outspoken Tesla bull, said in a research note. “It has a scale and scope unparalleled in the electric vehicle industry, and this dynamic could give Musk and Tesla a clear competitive advantage in an environment where electric vehicle subsidies do not exist.”
Ives also believes Trump could help advance Musk’s robotaxi dreams, especially by limiting any recent federal barriers to the technology. “In this scenario, the acceleration of autonomous driving will be the focus for investors, as some of the 2026/2027 targets for Tesla could be accelerated to keep pace with the current autonomous driving schedule in China.”
The unexpectedly close bond between Musk and Trump that has developed over the past yr is more likely to make the tech billionaire, already a larger-than-life figure in several industries, a uniquely influential figure within the years to return – if the present lovefest continues.
“He loves power. He has relied on the government to build his businesses and that will be of great benefit to everything he does, so he will be very involved in the new administration, Gerber said. “The risk that most people haven’t mentioned is that Trump will quickly tire of big egos. It’s one thing to be in the spotlight and use Elon’s power to win. Once in office, dealing with Trump is a different matter, and he has many interests vying for his love. And if you remember last time, everyone who was close to him on day one was dead on day 35.”
