Elon Musk bet the presidential election comes with high stakes

• Elon Musk has gone all in to support former President Donald Trump for re-election.
• Musk could gain influence at the federal level if Trump is elected president.
• It’s unclear what a Harris administration would mean for Musk and his business empire.

There is a lot at stake for Elon Musk and his business empire this election season.

Since advertising his endorsement of former President Donald Trump in Julythe billionaire has consistently used X to express his support for the Republican Party and has taken the stage with Trump during at least two rallies.

He has hosted his own series of political “conversations“and invested more than $130 million in pro-Trump efforts this year. He has also committed to a $1 million daily giveaway to swing-state registered voters who sign his petition in support of free speech and the right to bear arms.

Musk’s actions raise the question: What can the billionaire get out of a Trump presidency?

Potentially a lot.

Musk under Trump

Many of Musk’s companies are highly dependent on federal approvals, regulations, subsidies or contracts – and Trump has promised a lighter regulatory environment with plans to lower corporate and personal taxes.

If Trump secures the presidency, University of California, Berkeley business and public policy professor Francesco Trebbi told Business Insider that Musk could benefit from “installing key people in the public administration.” This could secure him valuable connections that extend beyond the next four years, he said.

Trump has already incorporated some of Musk’s policy proposals into his campaign, with plans to establish a government efficiency commission headed by Musk. Trump has said the commission will conduct a “complete financial and performance audit of the entire federal government” and propose “drastic reforms.”

Musk proposed to lay off a number of federal workers at a town hall in Pennsylvania on October 18.

“What the hell do you need 428 agencies for,” Musk recently said at a convention in Pittsburgh. “Like why do you even need 100?”

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Erik Gordon, area chair of entrepreneurship studies at the University of Michigan’s Ross School of Business, said a Trump presidency could also result in less scrutiny by regulators. That could give Musk “more freedom to develop advanced technologies — one of his favorite things to do,” Gordon said.

Tesla is at a pivotal moment as investors look to Musk’s promise to secure approval for fully autonomous vehicles in Texas and California. However, ongoing investigations into Tesla’s self-driving technology by government agencies, including the National Highway Traffic Safety Administration, could set back the company’s autonomous plans.

During a recent earnings call, Musk suggested that if there was a government efficiency commission, he would help push the state-by-state approval process forward with a “federal approval process for autonomous vehicles.”

For SpaceX, Trebbi said a Trump presidency could help the company secure major Defense Department contracts. That could help it keep its edge against rivals like Blue Origin.

Musk under Harris

While Musk could gain power, government contracts and looser regulations under Trump, it’s unclear how he might be affected under a Harris administration.

One key policy on the minds of many business leaders is Harris’ proposed tax plan. She aims to raise the corporate tax rate from 21% to 28% – a move Bank of America estimates could reduce earnings by 5%. That, combined with the possibility of stricter regulations, could affect a number of companies, including those owned by Musk.

Gordon said Harris could introduce new safety regulations or introduce tax credits for electric cars or AVs that favor competitors.

For X, which Musk has branded the platform for free speech, Gordon said a Harris administration could push it to ban material labeled “misinformation.” However, Gordon said X would most likely prevail in the courts under the First Amendment.

Tevi Troya senior fellow at the Bipartisan Policy Center, said it is unlikely — and most likely illegal — that Harris would send orders to target Musk. However, it is possible that Musk could experience “selective enforcement,” said Troy, who is also a former senior White House aide.

“One would hope that government entities would be immune to political pressure,” Joan MacLeod Heminway, a law professor at the University of Tennessee, told BI. “However, people in these entities are human and may inadvertently scrutinize proposals coming from entities owned or controlled by Elon Musk.”

It’s also possible that nothing would meaningfully change for Musk under a Harris administration.

“We don’t have any strong indication that Harris wants to greatly expand the regulatory burdens,” Cary Coglianese, University of Pennsylvania law professor and director of the Penn Program on Regulation, told Business Insider.

Tom Narayan, an analyst at RBC Capital Markets, said a Democratic administration could be better for Musk because Harris supports the Inflation Reduction Act and manufacturing in Mexico, which Trump has spoken out against.

The IRA gives Musk significant benefits, including a $7,500 tax credit for new electric cars, which helps Tesla. It also offers tax credits for solar installations.

Karoline Leavitt, the Trump campaign’s national press secretary, told BI that if elected, President Trump will support the auto industry, “making room for both gas-powered cars AND electric vehicles.” However, he plans to terminate the Green New Deal and rescind unused funds from the Inflation Reduction Act in an effort to “quickly defeat inflation and bring down all prices.” Leavitt said.

Musk is playing a risky game

Since Musk has previously said he has supported Democrats, Trebbi said he may align with Trump to secure the administration’s support.

“I see Musk’s realignment with the Republican Party as a hedging strategy, designed to pre-empt government regulation/maintain government support regardless of who wins in November,” Trebbi said.

Coglianese also said its possible Musk sees himself as the one who can “turn the federal government around,” like his approach to acquiring Twitter.

“It’s also entirely conceivable that he just sees himself as someone who can be a savior,” Coglianese said.

Coglianese said the strategy of aligning with Trump is risky.

“He’s betting on a president who wants or is willing to pay Musk for his loyalty,” Coglianese said, adding that it’s not always clear that even his staunchest supporters will get everything they want.

Carl Icahn secured some relief while advising Trump in his first term, but his tenure ended in controversy, Coglianese said. The billionaire investor stepped down from his unpaid role amid criticism over potential conflicts of interest.

Other cases have ended more favorably. Trump has previously said that Tim Cook was the only CEO who called him directly when he had a problem. Apple’s CEO secured an iPhone tariff exemption with the former president.

“There are ethics rules that require compliance with different types of obligations, including conflict of interest reporting, for certain types of government positions,” Heminway said. “Elon Musk may not want to make those commitments.”