Tesla and SpaceX Lose $420 Billion in Market Cap in a Week as Politics Weigh on EV Leader

Many of you may remember that Tesla and SpaceX got significant boosts early on in their corporate lives from the Obama administration, the Democrat-controlled House, and the Democrat-controlled Senate. There’s a solid chance these companies would no longer exist today without that early support. Democrats in California and in the US government were also critical to consumer support for electric vehicles, air pollution standards for electric vehicles, and carbon credit markets that have led to billions of dollars of revenue for Tesla. Tesla would most certainly not have been able to rise and evolve as it did without all of that support — and, again, it’s questionable whether the company would have ever gotten profitable and been alive today if it didn’t have that strong support from Democrats. Republicans in power have not been willing to support EVs, put stronger pollution limits on gasmobiles, or require higher levels of fuel economy from automakers. Every time they have all the power of the US government, they go the other direction on these things.

Of course, we know that Elon Musk shifted to the right politically (to the far, far right) after a few things happened. Those key things were as follows:

• COVID-19 lockdowns — Elon Musk started to panic and go nutso when a) California was on lockdown in the heights of the COVID-19 pandemic and would not let Tesla send workers to the factory (Musk also claimed the virus would be long gone by April 2020 or something, which was a ridiculous, ill-informed claim that was very hard to believe at the time), b) Musk was forced to stay out home with his kids rather than go to work 80+ hours a week and spend a significant amount of his remaining time partying with friends.
• Becoming an enormously rich billionaire — Musk did not at all want to pay taxes on his extreme wealth after he became one of the richest people in the world. That is also reportedly one of the key reasons he moved Tesla from California to Texas.
• His child being trans — Musk had five sons initially, and one of them was trans and became female. Musk has had massive issues with this, has basically said that child is no longer his child, and has gone on a massive anti-trans push in the past half decade or so.
• Not invited to a press conference — Joe Biden held an EV event/press conference during his presidency in which he didn’t invite Tesla and also called GM a leader on EVs. The reason Tesla wasn’t invited was because this was for unionized companies and Tesla has been very loudly anti-union (Musk was even convicted of union busting by a federal judge at one point). In my opinion, it was stupid to have such an even and not have Tesla there. However, I also think it’s crazy how much this seemingly mattered to Musk and how much of an anti-Democrat kick he’s gone on since then.

Overall, historically, Democrats have been the ones who have pushed strong policies in support of the clean technologies Tesla develops and sells. However, because of the above (as well as a ton of seeming corruption and anti-democratic, oligarchic influence), Musk has been one of the top funders and campaigners for the Republican Party in recent elections. In this most recent midterm election, he was the single largest individual donor in the country, providing at least $447 million to try to get Republicans elected — completely unsuccessfully (well, like 99.99% unsuccessfully or something like that).

If Elon Musk had continued on his previous rather nonpartisan or bipartisan tendencies, who knows what this election would have meant for Tesla (and SpaceX). However, now that he has become the #1 Republican donor in the United States, and heavily stacked his social media platform in support of Republicans, one has to wonder how Democrats in control of Congress — and perhaps later on the presidency — will respond to the countless attacks Musk has waged against them. It’s logical to assume there will be repercussions. Perhaps they won’t target him unfairly, but they may well choose to investigate and seek punishments for illegal activity, provable corruption, and undemocratic behavior. Instead of this gigantic blue wave being something we could expect to help Tesla, everyone is now wondering if Tesla is going to face some serious consequences.

As a result, reportedly, Tesla and SpaceX lost $420 billion (yes, billion) in market cap following the election — ironically. Perhaps that value has changed now, but how fitting is it that this is the punishment the market is delivering for Elon Musk being so massively wrong politically. For now.