Connect with us

Hi, what are you looking for?

OMD NewsOMD News

Crime

Elon Musk bet big on Donald Trump. Here’s what he stands to gain – and lose – from his win – The Mercury News



By Chris Isidore | CNN

New York  — No single business leader did more to support former President Donald Trump’s candidacy than Elon Musk. But the billionaire and his business empire face both positives and negatives after Trump won back the presidency in Tuesday’s election.

Musk has donated nearly $119 million so far to a political action committee he set up to support Trump, according to Federal Election Commission filings. He’s appeared with Trump at rallies and hosted a fawning interview with him on X, his social media platform.

“He’s bet big here. He dove into the deep end of the pool on this election,” said Daniel Ives, tech analyst at Wedbush Securities.

Early Wednesday, investors were already betting that Trump’s win will also be a win for Musk’s major public holding, Tesla (TSLA), sending shares of his electric vehicle maker up an immediate 13% at the market open, and closing regular trading up nearly 15%. That lifted the value of the 411 million shares of Tesla that Musk owns outright by more than $15 billion, which works out to a 12,761% return on the $119 million he donated to Trump. It was a two-year high for Tesla shares, which had struggled recently and were only up 1% for the year through Tuesday’s close.

But there are risks for Tesla, even from Trump’s victory.

Much of Musk’s massive net worth can be traced to the government support his companies, such as Tesla and SpaceX, have received over the years. Even if Vice President Kamala Harris had won, much of that money would have continued to flow. But even if some of the government support for electric vehicles is now trimmed or cut off, as is likely with Trump’s victory, Musk’s wealth will remain firmly intact. In fact, Tesla could benefit if government support for EVs ends.

What a Trump win means for Tesla

Musk posted numerous tweets on his social media platform X late Tuesday and early Wednesday celebrating Trump’s victory.

“The people of America gave @realDonaldTrump a crystal clear mandate for change tonight,” he wrote in one of them.

Trump has been openly hostile to electric vehicles, saying they are too expensive, have limited range, and will destroy jobs and the American auto industry. But what might seem like the biggest blow to Tesla from another Trump presidency — a reduction, if not the end of federal support for EVs — might not be all that bad for Tesla and Musk.

But other policies that are the center of Trump’s plans could cause major problems.

Trump has vowed to end something he calls “Biden’s EV mandate,” even though no such mandate exists, and it is unclear what he is referring to.

But under Biden there has been significant government support for building and buying EVs, including billions of dollars in loans to encourage automakers to invest in factories to build EVs and batteries in the United States, support for charging stations and a $7,500 tax credit to many electric car buyers.

Many industry experts believe Trump will end those programs. Trump could order the Treasury Department to change the rules that determine when car buyers qualify for the credit, greatly limiting the tax credit’s availability. Or, if Trump has a Republican-controlled Congress, he could get legislation passed to eliminate the credit all together.

But Musk has said he’s not worried about the end of the tax credit, as Tesla sees it as a boon to legacy automakers’ efforts to move into the EV market and provide more competition.

“Take away the subsidies. It will only help Tesla,” Musk posted on X in July.

Thanks to increased competition, Tesla’s global sales sank 2% in the first nine months of this year compared to last year. Sales and profit managed to improve in the third quarter, but it was the first time the company had ever seen such a drop in its history.

Self-driving vehicle policy could change





Source link

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Finance

There is finally an update on 4th stimulus check for Social Security Recipients! Individuals who receive Social Security benefits can expect to receive a...

Military

The attack using 14 military choppers that Russian President Vladimir Putin planned was destroyed by Ukraine using US-supplied long-range tactical missiles. Russian President Vladimir...

Finance

The Biden administration has announced recently that it plans to increase the monthly payments of seniors and veterans to $2,000. $2,000 in Monthly Payments...

Finance

In Texas, this September the SNAP payments will end, worth up to $1,691, on Friday. The household income determines eligibility. A single-person household must earn more than...