Tesla and SpaceX Combined Market Value Drops Over $420 Billion Since Tuesday's Close

After the U.S. midterm elections, Democrats gained control of the House and Senate. Tesla and SpaceX shares declined, with the two companies losing a combined market value of more than $420 billion since Tuesday's close. As of Thursday's close, the market value loss for Tesla and SpaceX was approximately $456 billion. On Thursday afternoon, the two companies' shares fell about 11% and 9%, respectively. According to Forbes data, Elon Musk's personal wealth dropped by about $90 billion over the past week, falling below $800 billion. After SpaceX's initial public offering in June, his personal wealth had exceeded $1 trillion. According to Financial Times data, Elon Musk donated more than $470 million to Republican candidates and related causes during the midterm elections. In Texas, Democratic candidates James Talarico and Gina Hinojosa were elected senator and governor, respectively. Tesla and SpaceX are both headquartered in Texas. Deutsche Bank analysts said in a Wednesday report that SpaceX may face headwinds. Texas Governor-elect Gina Hinojosa called during her campaign for a pause on approvals of new projects until the legislature introduces stronger protections regarding water usage, electricity costs, local control and incentives. Tesla and SpaceX are both currently building AI infrastructure in Texas and plan to build a "Terafab" facility in Grimes County that includes a data center and semiconductor plant. According to the companies' job listings, SpaceX plans to build a "supercomputer" at its Starbase launch facility. The analysts noted that SpaceX's computing capacity projects in Texas may face delays, and its capital expenditures may need to increase to meet expected regulatory requirements for data center construction. According to CNN, citing information from a Democratic senator's aide, Elon Musk and SpaceX have been asked to preserve records related to restrictions on the military version of the "Starlink" satellite internet service for Ukraine. In addition, regulatory scrutiny could block Elon Musk's previously proposed plan to merge SpaceX and Tesla, which had previously been indicated as requiring shareholder approval.