Tesla Motors shares have surged more than 40 per cent since December as Bloomberg notes in a new report. The price of Tesla stock isn’t the only thing looking dandy for Elon Musk under the Trump presidency.
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Besides the soaring stock price, Tesla also just completed its acquisition of another Musk-backed company, SolarCity, and now Tesla’s Gigafactory is ready to ship “Made in America” hardware. This comes at a time when one other very influential person is eager to promote American-made manufacturing: US President Donald Trump.
On the surface, Musk and Trump are an odd pairing. Musk is a South African-born American immigrant who is spends much of his time building clean, renewable energy products. Trump, on the other hand, was born into a wealthy East Coast family and appears to be spending his efforts on doing the opposite of Musk by signing executive orders to revive controversial oil pipeline projects, and famously called climate change a Chinese hoax.
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Prior to the US election, Musk was vocal about his disapproval of Trump, saying in a CNBC report that “[Trump] doesn’t seem to have the sort of character that reflects well on the United States”.
But Musk has seemingly completely altered his approach to Trump since the election. He first met with the Trump administration in late November when he participated in a meeting with top Silicon Valley executives. “In the world, there’s nobody like the people in this room,” Trump said after the meeting. “Anything we can do to help this go along, we’ll be there for you.”
Musk apparently took those words to heart. He joined Trump’s economic advisory board in December and is set to regularly meet with Trump and his aides. The tech billionaire took a private meeting with top Trump aides in early January at Trump Tower. He also met with the US president during his first full business day in the White House.
It’s obviously unclear what type of policies or decisions are discussed during these private meetings, but investors are bullish on the possibilities — Morgan Stanley analysts predicted a sizeable increase in Tesla’s stock price, as the company stands to benefit significantly from Trump’s American-made manufacturing policies as well as his direct line to the White House.
This couldn’t come at a better time for Musk. Tesla is currently gearing up to produce its first mass-market electric vehicle, the Model 3, which could reap the benefit of Trump’s promised domestic manufacturing tax breaks. Investors have clearly been rushing to own Tesla stock prior to the launch of the Model 3 later this year.
Then, of course, there’s SpaceX, the commercial aerospace manufacturer and space transport company owned by Musk. The privately-owned company stands to earn tens of millions of taxpayer dollars through lucrative government contracts sending cargo to the Space Station.
Strangely, Musk has started advocating on behalf of former ExxonMobil CEO Rex Tillerson, Trump’s pick for secretary of state. Tillerson’s nomination has been criticised for, amongst other things, the former executive’s ties to Vladimir Putin and his lack of government experience. Musk recently defended his support for Tillerson in an interview with Gizmodo.
“Tillerson obviously did a competent job running Exxon, one of the largest companies in the world,” Musk told Gizmodo yesterday. “In the [Secretary of State] role, he is obligated to advance the cause of the US and I suspect he probably will. Also, he has publicly acknowledged for years that a carbon tax could make sense.”
Musk and Tillerson apparently agree on plenty of other things as well, according to a recent Recode report. Both support US participation in the Paris climate accord and a national carbon tax, for example. Musk is said to have floated the idea of a carbon tax to Trump this week.
Greasing the wheels on this budding friendship between Musk and Trump is mutual friend Peter Thiel. Both Musk and Thiel are members of the notorious “Paypal Mafia“, a name given to a group of former PayPal employees and founders who have since moved on to create new gigantic technology companies.
Thiel has been a staunch supporter of Trump since prior to the US election and was one of the few Silicon Valley entrepreneurs to support him publicly. Thiel now serves as an informal adviser to Trump on matters of technology and innovation, according to the New York Times.
All of this is besides the fact that Musk is a master of publicity. His appearances are always a major affair, whether he’s announcing something as dull as a giant home battery or plans to colonise mars, he shows up perfectly coiffed in a tailored blazer and gets the world to tune in. Perhaps Musk and Trump aren’t such an odd pairing after all.