Both SpaceX and Tesla, companies led by Elon Musk, have their headquarters in Texas, making recent election outcomes in the state significant. Share values of Tesla and SpaceX dropped over 4% in premarket trading following Democratic victories in Texas midterm elections, affecting the region where the companies operate.
These political shifts included James Talarico’s win against Republican nominee Ken Paxton for a Senate seat and Democrat Gina Hinojosa unseating long-term governor Greg Abbott. For Musk, the results are painful as he invested approximately $224 million in support of Republican candidates in Texas, with $158 million spent in September alone, according to The New York Times.
If these share declines persist at market open, Tesla and SpaceX could face a combined market value loss exceeding $140 billion. This adds pressure on Musk, who had previously relocated SpaceX’s headquarters from California to Texas, a move critiqued by the state’s lawmakers. Now, Musk’s companies might see increased regulation from Democratic officials.
Tesla’s operations in Texas include the Austin gigafactory and a robotaxi service functioning in several cities. SpaceX conducts its Starship rocket launches from the Starbase facility in Boca Chica, near the Mexico border.
Dan Ives, a Wedbush analyst with a positive outlook on SpaceX and Tesla, stated that Musk “needs to find the path forward with Texas now with a Democratic win on both the Senate and Governor race.” Musk contributed at least $446 million to support Republican candidates leading up to the election, and faced criticism from Talarico who condemned the billionaire during his victory speech.
Reacting to the widespread Democratic successes in midterm elections, Musk expressed his thoughts on X, considering SpaceX’s plans to construct data centers in space as appealing. He remarked humorously about his election-interfering space lasers failing to work this time.
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