Elon Musk's support of Donald Trump in his second term victory gives the billionaire entrepreneur extraordinary leverage to help his companies secure favorable government treatment.
Musk, according to official figures, donated at least $119 million to a Trump-supporting group and tirelessly promoted the former president in the key run-up to his campaign.
Musk's political activity reflects a broader strategy to shield his companies from regulations and laws and increase government support, Reuters said, based on interviews with six sources at Musk's companies who are familiar with his political and business connections, as well as two government officials who have extensive interactions with Musk's companies.
Musk's business interests — from Tesla electric vehicles to SpaceX rockets and Neuralink brain chips — depend heavily on government regulation, subsidies or policy.
"Elon Musk sees all regulation as an obstacle to his business and innovation," said one former senior SpaceX official who spoke on condition of anonymity. "He sees the Trump administration as a tool to remove as much regulation as possible, so he can do whatever he wants, at a speed that suits him."
Musk endorsed Trump on July 13, the day the Republican nominee was shot in the ear in an assassination attempt in Pennsylvania. Musk's donations funded a broad campaign to boost voter turnout, as Trump faced a tougher challenge after Vice President Kamala Harris replaced President Joe Biden in July as the Democratic presidential nominee. Musk spent election night with the future president at his Mar-a-Lago club in Florida, and Trump said he would give Musk the position of "czar of efficiency" in his administration.
The Trump campaign called Musk a "once-in-a-generation industry leader" in a statement to Reuters, adding that "the corrupt federal bureaucracy will certainly benefit from his ideas and efficiency."
Elon Musk sees the Trump administration as a tool to remove as much regulation as possible so he can do whatever he wants at a speed that suits him, an official said.
Musk once built his image primarily on fighting climate change, producing electric vehicles to reduce pollution and rockets that could one day help humans escape to Mars from a dying Earth. He now heads a growing class of Silicon Valley billionaires who support the libertarian movement in response to the region's historically liberal ideology, which Musk now derides as a "virus of awakened consciousness."
Thanks to his greater political engagement, his industrial empire could find itself in a position that current and former employees have compared to the "golden age", when industrial barons like J.P. Morgan and John D. Rockefeller had a great influence on government policy concerning their business and wealth.
Musk's growing power has excited his supporters who see the government as an obstacle to his high-tech operations, including Shervin Pishevar, a venture capitalist who has invested in SpaceX and has pushed to bring Silicon Valley closer to Trump. Deregulation, he said, would speed up SpaceX's efforts to reach Mars.
"He will make America work like a startup," Piševar said of Musk. "There is no greater entrepreneur in American history than Elon Musk."
Policy management in the automotive industry
Musk's political rise comes after he experienced what he saw as slights during the Biden administration, which accelerated Musk's embrace of Trump's right-wing populism. For example, Tesla representatives were not invited to the White House EV Summit in August 2021.
Tesla's fate depends on Trump's attitude toward various subsidies, policies and regulatory frameworks for electric and autonomous vehicles. Democratic administrations have historically supported many such policies, with Musk's backing. Musk could now protect them, despite the Republican Party's traditional resistance to electric vehicles — and Trump's mocking of Biden's electric vehicle policies during the campaign.
Musk could advocate for the favorable regulation of autonomous vehicles and robotaxis that Tesla is planning, a Reuters source said. For his new artificial intelligence startup, xAI, Musk could shape initial regulations or a new agency, the source added.
Musk said last month that he expects to start introducing driverless Teslas in California and Texas next year, and that in 2026, he will begin production of a fully autonomous "Cybercab" without a steering wheel or pedals. Tesla would have to get an exemption from the NHTSA (National Highway Traffic Safety Administration) to produce such a vehicle.
There are no national regulations governing how autonomous vehicles can be released into traffic. This means that operators have to deal with different regulations in each country. Musk lamented the challenges of a regulatory landscape that varies from state to state and pushed for a single approval process at the federal level.
When it comes to his brain implant startup, Neuralink, Musk has long complained that the US Food and Drug Administration (FDA) approval process is slowing down human applications. Musk could use his growing influence in the Trump administration to speed up some of the security-related approvals in the process, a source familiar with the company's work told Reuters.
Musk has long been extremely frustrated with the FDA's pace of work. Some Neuralink employees are considering the possibility that if Musk becomes Trump's "efficiency czar," he could fire FDA officials he deems ineffective, a source at the British agency said.
Growing power
Musk's plans to establish a loose regulatory environment come at a time when his companies are already privileged under federal rules, said sources at Musk's companies familiar with his regulatory affairs and political strategy.
Some federal agencies are already having trouble mustering the political will to prosecute Musk's companies for alleged policy violations or safety concerns, they say, in part because Musk is a dominant player in highly regulated and politicized industries such as electric vehicles and rockets. .
NASA and other agencies often try to avoid taking issue with the company, a federal official familiar with the government's interactions with the company told Reuters on condition of anonymity. "SpaceX needs NASA more than NASA needs Space-X," the official said.
NASA has invested more than $15 billion in SpaceX.
SpaceX is also, separately, developing a network of hundreds of spy satellites with the US intelligence agency.
A Reuters investigation last year documented at least 600 injuries to workers at SpaceX facilities across the country and found that Musk's rocket company ignored safety regulations and standard practices. Injury rates to workers at Space-X facilities continued to exceed the industry average last year, the British agency points out.
Neither NASA nor OSHA, which regulates worker safety, has taken any significant action against SpaceX for worker injuries and reporting violations.
Although his company has grown faster than the competition, Musk has harshly criticized the government for trying to enforce the rules. In an interview before the election, he described federal enforcement as too strict and said his goal was to get rid of "crazy" regulations.
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