Billionaire tech mogul Elon Musk has publicly endorsed former President Trump’s campaign, a move that appears to be at odds with his interests as CEO of Tesla, given the former president’s hostile stance toward the electric vehicle industry.
But experts said Tesla could benefit from the Biden administration’s proposed cuts to EV subsidies, while Musk’s other companies and the billionaire himself could also benefit from Trump’s reelection.
Musk supported former President Trump, who was injured in an assassination attempt at a Pennsylvania rally earlier this month, and had pledged to donate millions of dollars to support Trump’s campaign but then backed off the donation.
The endorsement marked a turning point for the billionaire, who had long been moving to the right politically but had not yet fully endorsed Trump.
Musk’s rightward shift aligns him with Trump on many issues, including immigration, but the former president’s vow to end Biden’s EV policies would initially seem a disadvantage for the Tesla CEO.
“I will end the electric vehicle mandate on Day One,” Trump said in his speech at the Republican National Convention last week, claiming he would save “the American auto industry from total extinction.”
Musk’s electric vehicle company is central to his status as the world’s richest person: He owns about $120 billion in Tesla stock and options, which makes up the bulk of his fortune, according to The Washington Post.
But Musk recently argued that repealing Biden’s EV policies, which include a $7,500 federal tax credit for consumers who buy qualifying electric vehicles, “will only help Tesla.”
“Remove subsidies,” Musk wrote in a post last week on X, the social media platform he bought and rebranded. “It will only help Tesla. Also, remove subsidies from all industries!”
Wedbush Securities analyst Dan Ives largely agreed with Musk’s assessment, suggesting that Trump’s reelection and the potential loss of the EV tax credit would be a blow to the industry as a whole but a boon for Tesla.
“A Trump presidency is bad for EVs but good for Tesla because the tax rebate withdrawal gives Tesla a price advantage over the industry in terms of scale and scope,” Ives said.
“Their scale of production is not comparable to other EV manufacturers,” he continued. “Some of them are trying to make 50,000 to 75,000 cars a year, whereas Tesla is at around 2 million. So they have a price advantage, and when the rebates go away, the competition will even out and Tesla will have the advantage.”
Maxwell Shulman, a research analyst at Beacon Policy Advisors, said the billionaire Musk’s recent comments about EV subsidies may just be “typical Musk bombast and overconfidence.”
But Schulman acknowledged that Tesla may have a comparative advantage “if those supports go away.”
“Tesla has a head start,” he said. “It has the largest market share, it’s been around the longest, it has the organizational expertise, and maybe most empirically… analysts still generally say Tesla’s profit margins are thousands of dollars higher than other traditional automakers.”
Musk’s closeness to Trump could be a welcome departure from the billionaire’s frosty relationship with Biden.
The feud between the Tesla CEO and Biden appears to have stemmed from the president’s decision early in his term to prioritize automakers that had contracts with the United Auto Workers (UAW) and exclude Musk from several EV-related events at the White House.
“Musk has a strong relationship with Trump,” Ives told The Hill. “Musk has been on the back burner in the Biden administration.”
Meanwhile, at a rally in Michigan over the weekend, President Trump praised Musk as a “brilliant guy” and stressed that he is not entirely opposed to electric vehicles.
“I love Elon Musk. Do we love him? I love him,” the former president said. “I talk about electric cars all the time, I’m not against them, I’m totally for them, but whatever the market says.”
Trump also said in an interview with Fox News this week that he never pressured Musk to change his stance on EVs.
“The amazing thing about Elon Musk is, I’ve been waiting all this time, and he’s never called me and said, ‘Can you quit the electric car business?'” Trump said.
Experts said Musk and his other companies could also benefit from a Trump reelection.
A Trump presidency could create a tax and regulatory environment that is favorable to billionaires and their corporations, especially if the House and Senate are held by Republicans.
Republicans want to renew several key provisions of the Tax Cuts and Jobs Act, which is set to expire in 2026. For example, the corporate tax rate was lowered from 35% to 21% in tax cuts during President Trump’s first term, but some Republicans are now calling for even bigger cuts.
Under a Republican administration, Musk would also likely consider “significantly reducing the regulatory environment,” Schulman said.
The billionaire’s company has often been at odds with the federal government.
The Department of Justice is reportedly investigating whether Tesla misled investors and consumers about the capabilities of its Autopilot and Full Self-Driving systems, and the Equal Employment Opportunity Commission sued the EV company last September for racial harassment and retaliation.
The National Labor Relations Board (NLRB) sued SpaceX in January, accusing the company of illegally firing several employees who had criticized Musk. The spacecraft and satellite communications company sued the NLRB in response, challenging the agency’s structure.
Musk has also been involved in a number of legal battles with the Securities and Exchange Commission over his purchase of Twitter (now TwitterX) shares and comments he made about Tesla on the platform.
“I can’t put myself in anyone’s shoes, especially Elon Musk’s, but I can understand why he’s taking chances on what kind of presidential administration would be more favorable overall given his overall interests,” said Scott Ganz, an associate professor at Georgetown University’s McDonough School of Business.
As prominent tech figures like Musk become increasingly supportive of President Trump, Ganz suggested they might be hoping to influence regulatory policy.
“The recent endorsements of former President Trump by prominent Silicon Valley and tech figures, particularly Elon Musk, may signal hope that they will be able to influence a future Trump administration’s regulatory policy, particularly on tech, in a way that was unavailable under Harris,” he said.
“I think there’s a growing recognition across the tech industry that it needs to have some influence on federal policymaking,” Ganz added.
Musk is one of the latest wealthy tech entrepreneurs to endorse the former president. He and several other former Democratic donors have switched sides to back Trump in the election, joining a small established group of conservatives in Silicon Valley.
A newly formed pro-Trump super PAC called America PAC has raised millions of dollars from the group, which also includes Palantir co-founder Joe Lonsdale, Sequoia Capital partners Doug Leone and Sean Maguire, Valor Equity Partners CEO Antonio Gracias, and cryptocurrency investors Cameron Winklevoss and Tyler Winklevoss.
Musk also said he plans to donate to the super PAC, though not as much as the $45 million per month originally reported.
“I donate some money to America PAC, but it’s a much smaller amount, and the PAC’s core values are supporting meritocracy and individual liberty,” he wrote to X. “Republicans are largely on the side of meritocracy and liberty, but not entirely.”
