Elon Musk's support for President-elect Donald Trump has paid off in spades, with his net worth topping $300 billion on Friday, much of it for Tesla, whose market capitalization exceeds $1 trillion. It depends.
Musk has donated nearly $120 million to pro-Trump super PACs, valued at $302 billion as of Friday. According to ForbesThis calculated his wealth by taking into account his 20% stake in Tesla and an estimated 42% stake in SpaceX.
As of November 2020, about 75% of Musk's wealth came from Tesla stock.
“Given the election results, Tesla and CEO Elon Musk are probably the biggest winners,” said Garrett Nelson, senior equity analyst at CFRA Research. “We believe this will facilitate regulatory approval.”
Under the Trump administration, Mr. Musk pushed for favorable regulations for Tesla's planned self-driving cars, and also directed potential enforcement actions regarding the safety of Tesla's current driver-assistance systems to the National Highway Traffic Safety Administration. The deal may be put on hold, an official told Reuters.
Musk is also a majority shareholder in xAI, an artificial intelligence startup he founded last year. Mr. Musk has a 60% stake in the company, which is negotiating a new funding round that could value the company as much as $40 billion, according to Forbes.
Mr. Musk has surpassed the $300 billion threshold before. In November 2021, Tesla stock reached an all-time high of $407 per share. However, the company's stock price has plummeted by as much as 72%, dropping to $113.06 per share in January last year.
As of Friday, Tesla stock was trading at about $317 per share, up about 7% from the opening bell.
Tesla shares soared in late October after the company reported higher quarterly profit margins, helped by sales of its highly profitable fully self-driving driver-assistance software.
The company has long been the world's most valuable automaker, trailing the likes of Japan's Toyota Motor Corporation and BYD by hundreds of billions of dollars.
Musk sold most of his Tesla shares to help finance his $44 billion acquisition of Twitter, which he later rebranded as X.
According to Forbes, Mr. Musk overpaid for X, and as of August, it was worth nearly 70% less than its $44 billion price tag.
Tesla has struggled to maintain market share in recent years as high inflation has contributed to weak demand for electric cars.
The company also faces increasing competition from rivals in China, where domestic manufacturers such as Warren Buffett-backed BYD and Xiaomi have disrupted the market.
President Trump said he would appoint Musk to chair a new government efficiency commission. Musk said at least $2 trillion could be cut from the $6.75 trillion federal budget.
Musk has focused on self-driving car technology and abandoned plans to build economy cars that cost less than $30,000. However, development and regulatory hurdles have slowed the commercialization of such technologies.
with post wire
