Tesla CEO Elon Musk’s growing alliance with former President Trump appears to be yielding positive outcomes for the company, potentially giving Tesla a notable advantage under the new administration.
Musk’s net worth exceeded $300 billion on Friday for the first time in more than two years. The 53-year-old saw an increase of about $13 billion in his wealth during the Tesla stock rally, making him $70 billion richer than his nearest competitor, Larry Ellison, the chairman of Oracle and Musk’s close friend.
Tesla’s market value surpassed $1 trillion on Friday for the first time since early 2022, as the electric vehicle giant, led by the world’s richest man, Elon Musk, experiences a significant rally. This surge follows the election of Musk-backed Donald Trump to a second presidential term, which has seemingly contributed to the company’s growth and market confidence.
Musk remains Tesla’s largest shareholder, owning a 13% stake valued at around $130 billion. He also holds a pending 9% stake, tied to an appeal in Delaware court concerning a 9% bonus in stock options. Forbes has factored in a 50% discount on this bonus when assessing Musk’s overall wealth. Tesla’s stock is currently about 25% lower than its peak of $415, reached in late 2021, when Musk’s net worth topped approximately $320 billion.
In July, Musk threw his support behind Donald Trump, contributing around $130 million to his election efforts. Musk became a prominent figure on the campaign trail, even appearing in a photo at Trump’s victory celebration with the former president’s family. The two have also discussed a potential role for Musk in the Trump administration, with Trump referring to him as the “secretary of cost-cutting.” In his victory speech early Wednesday morning, Trump gave Musk a special mention, saying, “We have a new star. A star is born — Elon!” The president-elect has previously hinted that the tech mogul could lead a panel dedicated to reducing government costs.
Trump has previously indicated that he might reduce the federal $7,500 electric vehicle tax credit, which has historically played a significant role in driving sales of Tesla vehicles.
In Tesla’s latest earnings update, the company reported a revenue of $25.18 billion and a net income of $2.17 billion for the third quarter. During the earnings call, CEO Musk shared his “best guess” that “vehicle growth” could reach 20% to 30% in the coming year, driven by the availability of “lower-cost vehicles” and the “advent of autonomy.”
