How will Elon Musk benefit from Trump’s presidential victory?

As Donald Trump celebrated his presidential victory early Wednesday morning, Elon Musk was there with him.

“A star is born. Elon,” Trump said on stage at his Mar-a-Lago resort, thanking the world’s richest person for spending two weeks campaigning in Pennsylvania.

Musk, who has spent at least $130 million on pro-Trump campaign efforts, has turned supporting Trump into another full-time job in recent months, bankrolling a swing state operation to register voters and using his social media platform X to constantly promote his party. Favorite candidate, often with misleading information.

Musk’s investment in Trump is already paying off, even though Trump won’t take office until January 20.

Tesla Shares rose 15% on Wednesday, adding nearly $15 billion in paper value to Musk’s net worth. The electric car maker is facing global market headwinds from China-based rivals, leading to declining European sales and growing consumer distaste for its political views.

But with Musk kowtowing to Trump, and the president-elect promising to scale back the kinds of regulations Musk abhors, Wall Street is betting that Tesla, overall, will benefit.

For Musk, the potential gains go far beyond Tesla.

During his victory speech, Trump also praised Musk’s company SpaceX and thanked Musk for delivering Starlink Wi-Fi stations to hurricane-stricken parts of the United States. All of which leaves Musk with plenty of reason to be optimistic that a second Trump administration will pay him handsome dividends. And his works.

Musk’s companies are currently embroiled in a host of investigations and lawsuits from federal agencies related to matters including alleged securities law violations, workplace safety, labor and civil rights violations, violations of federal environmental laws, consumer fraud, and vehicle safety defects.

Given the executive branch’s outsized control over federal regulators, Musk could look forward to regulators and intelligence agencies ending some or all of the 19 known federal investigations and lawsuits underway against Tesla, SpaceX, and X, formerly known as Twitter.

At New York’s Madison Square Garden on October 27, Musk was one of many Trump fans and surrogates who spoke during a daylong rally. Most of the coverage of the event focused on comedian Tony Hinchcliffe’s bigoted quips, including his description of Puerto Rico as a “floating island of rubbish.”

Musk was introduced by Cantor Fitzgerald CEO Howard Lutnick, who described the Tesla CEO as the “greatest capitalist” in US history. Lutnick said he and Musk were co-founders of the envisioned “Government Efficiency Management,” and asked Musk how much he thought could be cut from the federal budget.

“At least $2 trillion,” Musk replied, which is more than the federal government’s amount Estimated budget of $1.7 trillion. This comment received a shout out from Lutnick and applause from the audience.

Musk did not specify what he was seeking to reduce, but he has previously accused agencies including the Securities and Exchange Commission, the Environmental Protection Agency and the Federal Aviation Administration of regulatory overreach or infringing on his free speech rights.

He also accused the Biden administration of hiring too many IRS employees, and openly objected to the so-called billionaire tax.

A role on an ad hoc committee could give Musk power over federal agency budgets, staffing, and the ability to push for the repeal of inappropriate regulations.

Musk also said during Tesla’s earnings call on October 23 that he intends to use his influence with Trump to create a “federal approval process for self-driving vehicles.” Currently, approvals are done at the state level.

Tesla has been working on driverless technology for more than a decade, but has yet to produce a robotaxi or a vehicle that is safe to use without a human ready to steer or brake at any time.

In addition, the Trump administration may agree to step up the government’s work with his companies.

Musk’s latest startup, xAI, is developing large language models and generative AI software aimed at competing with similar products from OpenAI, Meta, and other Microsoft-backed companies.

dead Recently announced The open source Llama models were available to US government agencies in the areas of defense and national security. OpenAI is already working with the US military after adding a retired US Army general and former National Security Agency director to its board of directors in June.

Musk did not respond to a request for comment.

According to research by FedScout on federal spending and major contracts, SpaceX has received more than $19 billion in contracts with the federal government since 2008, including from NASA, the U.S. Air Force and the Space Force.

The company is on track to secure several billion dollars a year in major contracts with the federal government for years to come, according to FedScout CEO Jeff Orazim.

This number does not include underground spending, smaller items like Starlink stations, or spending done at the state level through block grants from the federal government, such as when the Federal Emergency Management Agency provides aid to states to help recover from natural disasters.

Meanwhile, Tesla has reported sales of about $10 billion in “vehicle regulatory credits,” or environmental credits, since 2015, Orazim found by evaluating the company’s financial filings.

These incentives are largely derived from federal and state regulations in the United States that require automakers to sell a number of low-emission vehicles or buy credits from companies like Tesla, which often have a surplus.

Regulatory credits accounted for about 60% of Tesla’s net income in the second quarter of 2024, and 39% in the second quarter of 2024. Third quarter. Other government rebates on electric vehicle sales accounted for about 50% of Tesla’s third-quarter profits.

Trump did not indicate whether he would retain these regulatory rebates and credit programs. He previously said he might cut the $7,500 federal tax credit.

In addition, Trump promised to cut income taxes and implement heavy tariffs. While definitions It could help protect Tesla from Chinese competitors. Such a move could involve significant disruption to Tesla’s automotive supply chain, which relies on some materials and parts from China.

When it comes to protecting workers, Musk is seeking to overturn the National Labor Relations Board’s constitutional authority through litigation. He may find that such lawsuits are no longer necessary if Trump is willing to eliminate or reduce the authority of the agency, which is supposed to ensure that companies comply with federal laws that allow workers to form unions and engage in collective bargaining with employers.

Then there is Musk’s involvement with sanctioned governments.

At SpaceX, Musk has refrained from using Starlink, the company’s satellite internet service, over Taiwan, even for US forces stationed there. The Wall Street Journal reported that Musk cut off access as a favor requested by Russian President Vladimir Putin on behalf of Chinese President Xi Jinping during a series of ongoing and recurring conversations between the two men.

In response to these reports, NASA Administrator Bill Nelson said that if these reports are true, Musk’s conversations with Putin should be investigated at the federal level.

According to For NBC News analysisMusk has repeatedly posted pro-Kremlin content to his hundreds of millions of followers on X. He has even engaged with content from Tenet Media and its creators at least 60 times on the social network. Tenet was in the centre An alleged Russian secret operation To manipulate American public opinion before the 2024 elections, according to what the newspaper reported Ministry of Justice.

While Vice President-elect J.D. Vance recently called Putin US discountTrump has repeatedly spoken of his love for the Russian president, even since Russia’s devastating invasion of Ukraine in 2022. Kremlin officials celebrated Trump’s victory In this week’s elections.

Musk, who publicly endorsed Trump moments after the former president’s first assassination attempt in July, said he intends to remain involved in American politics for the long term.

He said at Tuesday’s discussion that his super PAC will continue its work after the presidential election and will seek to influence the results of midterm elections, midterm elections and district attorney elections across the United States.

Musk said the priority would be to help elect prosecutors “who prosecute violent criminals who clearly pose a danger to people.”