Tesla and SpaceX shares fall after Musk's US election spending fails to help Republicans
Shares of Elon Musk's companies declined in premarket trading after Democrats won control of Congress and the Texas governorship.
Shares of SpaceX fell 3.8 per cent and Tesla slipped 3.6 per cent in premarket trading following the US midterm elections, according to the Times of India. The decline occurred as Democrats took control of both chambers of Congress and Gina Hinojosa defeated Greg Abbott to become the governor of Texas.
Musk reportedly contributed approximately $474 million to Republican candidates during the 2026 midterms, including nearly $224 million in Texas. His spending aimed to help Republican candidates retain their positions and keep Texas red.
The Democratic victory in Texas is significant because the state houses Tesla, SpaceX, and a planned chipmaking venture between the two companies. Gina Hinojosa has previously sought emails regarding communications between Musk and former Governor Abbott, alleging that Abbott compromised Texas interests to provide Musk with special advantages.
Analysts suggest the Democratic presence in Congress could lead to increased scrutiny of Musk's businesses. SpaceX may face hurdles regarding approvals for data centres, as some leaders have called for construction moratoriums due to local opposition over electricity costs.
Hinojosa has stated that Texas is not for sale and has expressed support for ending tax breaks for such projects. She has also indicated a desire to pause data centre developments until stronger regulations are established for local protection.
