Elon Musk’s political support for newly elected United States President Donald Trump, has paid off handsomely after his net worth soared significantly.
Musk who reportedly spent over $130 million to support Trump’s presidential campaign, has seen his wealth skyrocket by $70 billion, pushing his net worth past $300 billion for the first time in three years.
This unprecedented rise is largely attributed to a surge in Tesla’s market value, spurred by investor enthusiasm surrounding the pro-business policies expected from Trump’s administration, which are anticipated to favor Musk’s ventures in electric vehicles and space exploration.
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Tesla’s stock alone has risen by approximately 39% in just four trading days since the election, propelling the company’s market cap beyond $1 trillion. Musk owns 411.06 million Tesla shares, as of the latest filings, and about 304 million performance-based options.
With most of Musk’s fortune tied up in Tesla stock, this increase has been transformative for his wealth, putting him close to $90 billion ahead of Oracle founder Larry Ellison, the second-richest person globally.
Commenting on Musk’s recent net worth surge, managing partner and co-founder at Deepwater Asset Management, Gene Munster, a longtime Tesla bull, in an interview with CNBC said, “He’s got the golden touch right now and has the ear”.
In addition to Tesla, SpaceX is also a “clear beneficiary” of a Trump presidency, Munster said. He added that xAI could be rewarded as the new administration considers AI regulations.
“I’m stretched to try to find out how this could play out negatively for Elon,” Munster said.
Musk’s influence on the new administration, however extends beyond the stock market. Determined to see Trump back at the White House, the Tesla CEO personally funded a series of political initiatives aimed at bolstering support in several US states.
Throughout the campaign, Musk used his social media platform X, as a strategic tool to advocate for Trump’s candidacy. His public and active support for Trump has not only reshaped the image of X, but has allowed him to harness the platform’s reach to influence the political landscape. Musk is already leveraging his close ties with the incoming administration.
Notably, his political alignment is expected to create a favorable regulatory environment for his businesses, particularly in sectors where he holds a leading position. Tesla, for example, stands to benefit significantly from Trump’s recent support for autonomous driving technologies and electric vehicle expansion.
Recall that Trump had earlier denigrated electric vehicles, arguing that supporters should “rot in hell” and that assisting the industry is “lunacy”. He however eventually shifted his view on EV vehicles, following Musk endorsement.
“I’m for electric cars, I have to be because Elon endorsed me very strongly,” he said.
Analysts are forecasting that a Trump administration could fast-track regulatory approvals for Tesla’s autonomous driving systems. For Musk, this could mean a competitive edge in the electric vehicle market as well as further growth for Tesla’s valuation, given the rising demand for driverless vehicle technology.
In the end, Musk’s strategic financial and political bets appear poised to provide sustained gains. As Tesla and SpaceX continue to grow within a potentially favorable regulatory framework, Musk’s wealth remains closely tied to these companies’ success and the evolving political landscape.