Billionaire Elon Musk could stand to gain after he went all in to help U.S. president-elect Donald Trump make one of the biggest political comebacks in history.
The Tesla CEO and X owner pumped millions into Trump’s campaign and used his social media platform X to herald support, becoming one of Trump’s biggest supporters in the 2024 campaign.
Musk now gets to see whether all of that pays off and whether a working relationship is possible between the two men, who are both famous for their massive egos.
Trump’s win could give Musk immense power behind the throne to steer U.S. policy, and he may try to wield his influence to reduce regulatory oversight of his businesses. He has been a vocal critic of federal review of his SpaceX rocket business and wants to speed up approval of his autonomous driving technology.
Investors also seemed to think that Trump’s win could be a win for Musk, with shares of Tesla surging nearly 15 per cent on Wednesday.
The billionaire CEO of Tesla and SpaceX has much to gain from the incoming administration. He has millions of dollars in government contracts and his companies face significant and at times costly government regulations related to consumer and environmental protections.
He is a major contractor with the U.S. Department of Defence through his ownership of the Starlink satellite broadband system and SpaceX has a $1.8 billion contract with NASA.
“A lot of businesses will cheer him on. And Trump will favour him with government contracts assuming they stay on good terms,” Bruce Cain, a professor of political science at Stanford University, told CBC News.
“But we are talking about two massive male egos. Musk better secure those deals in writing early on.”
Ranked by Forbes as the world’s richest person, Musk has spent more than $130 million US to back the Republican nominee.
The billionaire entrepreneur, who has a massive reach with over 203 million followers on X, threw his support behind Trump by publicly endorsing him for the first time in July, hours after the former president was shot in the ear during an assassination attempt at a rally in Pennsylvania.
Musk’s pro-Trump spending group America PAC (political action committee) also played a major role in helping mobilize and register voters in battleground states that could decide the election.
Happy marriage or messy divorce?
In September, Trump had said he would establish a government efficiency commission headed by billionaire supporter Elon Musk if he wins the Nov. 5 election, a job Musk vows will help rid the country of regulations he views as bad for the economy and a deterrent to doing business. Musk has said at least $2 trillion could be cut from the $6.75 trillion federal budget.
Musk said during Tesla’s third-quarter earnings call that he would use a hypothetical post at the head of a “Department of Government Efficiency” to push Trump on granting regulatory approval for self-driving vehicles.
“Initially Musk will be featured prominently in the Trump administration and given the task to reduce the size of the bureaucracy and its regulations,” Cain said.
“The fact that Musk expects to benefit from the very regulations he dismantles either formally or by weakening the government’s ability to monitor and enforce regulatory protections will add to the perception that policy is for sale under Trump.”
Trump and Musk have not always been in sync as Trump has said he won’t let California require all vehicles in the state to go electric in a decade, but Musk runs the world’s most valuable EV company.
Musk is also a big proponent of carbon-free energy, with Tesla being a major supplier of solar systems and batteries. Trump has promised to kill the offshore wind industry and rescind all unspent funds under the Inflation Reduction Act — Biden’s signature climate law.
“In the end, Trump does not abide people who take too much of his spotlight so this marriage will end in a messy divorce,” Cain said.
