Tesla’s CEO Elon Musk speaks to President Donald Trump during a meeting with technology leaders at Trump Tower on December 14, 2016.
Donald J. Trump P ’00: a name that symbolizes racism, misogyny, and the White House. However, while his name undoubtedly resonates negatively with millions of Americans, Trump is also now the most powerful person in the world. Known for both his political ignorance and outrageous promises, Trump has become a sought-after commodity for business sharks of various industries. The President’s most recent financier and adviser is quite an unlikely one — Elon Musk, a strong advocate for climate change and social progressiveness. But politics and personal opinions aside, this relationship with Trump is an extremely strategic business move for Musk and the future of his companies. Investors and financiers would be wise to side with Trump quickly, as he could aid them enormously.
Born in South Africa, Musk immigrated to the United States in the nineties. Soon after college, Musk helped co-found Paypal, which was later sold to eBay for $1.5 billion. Musk would eventually use the $165 million he received from the deal to initiate a handful of other risky startups, including now big name companies such as Tesla, Solar City, and SpaceX. Despite being the foremost pioneer in renewable energy in a world of fossil fuels, Musk has lately outspokenly supported the nomination of Rex Tillerson, former chairman and C.E.O. of energy giant ExxonMobil, for public office.
“This may sound surprising from me, but I agree with The Economist. Rex Tillerson has the potential to be an excellent Secretary of State,” Musk recently tweeted.
Even more surprisingly was Musk’s move to stand behind the President, especially as Trump has called several executive orders to revive the highly controversial Keystone pipeline. Musk has, on record, stated his disapproval of Trump during the election. For example, Musk told CNBC that Trump, “doesn’t seem to have the sort of character that reflects well on the United States.” So why did Musk, a left-wing advocate for clean energy and global warming, completely change his beliefs and ethical views?
The answer is simple: the finance and numbers.
Following Trump’s win in December, Tesla stocks demolished analysts’ 12-month price targets by trading at a massive $254 a share. According to Bloomberg, Tesla has skyrocketed over 40 percent since the end of last year, breaking its yearly high. To put a cherry on top of Musk’s constant winnings from Trump’s success, the billionaire has finally been able to merge the exponentially growing Tesla with his other high-rolling energy company, Solar City. Musk is simply tagging along on the Trump train in order to further his own interests. While this is ethically dubious, it’s a wise decision financially.
On January 6, Musk headed to New York to meet with Trump’s administrative team, further ingratiating himself with the White House. Musk spoke in depth with people like Steve Bannon, the president’s chief strategist, and Jared Kushner, Trump’s son-in-law who has been given a top role in the administration. At Trump Tower, the meeting covered a range of issues, mainly revolving around job creation. Musk openly stated that he wishes to be a leader for the nation when it comes to dealing with new transportation and energy resources, a powerful (arguably too powerful) position to be in when considering his ownership of one of the largest renewable energy companies.
Aware of Musk’s close relationship with the Trump administration, investors have been decidedly bullish with his companies. And they have every right to be scrambling over each other for a piece of Tesla or Solar City. With the finished construction of Tesla’s new Gigafactory outside Sparks, Nev., an estimated 1,000 additional workers are on track to join the already 800-strong working force. While the Gigafactory will help with the creation of quality grade lithium-ion batteries for the new Model 3, it is the “made in America” hardware that is clicking with both Trump and keen investors. This is largely due to Musk’s use of American workers, which falls in line with Trump’s stern commitment towards ensuring the security and forthcoming of providing American jobs. This bullish reaction to Musk’s support of Trump shows that other companies would be wise to cooperate with Trump and the G.O.P., despite Trump’s populist statements.
Ultimately, bona-fide analysts and investors will agree that Tesla will see more surges in the coming months. In addition to securing a personal connection to the White House, Musk’s companies are assuredly going to profit from the Trump’s new manufacturing policies.
His sudden change in political and worldly views is not Musk being a sleazebag: it is Musk being a sleazy businessman in order to survive in the financial world.
