The outbreak of war between Trump and Musk as a conflict of interest
The clash between Elon Musk and Donald Trump has become public on the international stage. The deterioration in relations between these two strong, polarised personalities marks the breakdown of their strategic partnership and puts the US political arena in check.
The crises that have restructured their partnership initially had to do with trade tariffs and then with Trump's economic law, which Musk identifies as a spending initiative. The Republican Party's tax bill has prompted Musk's attacks and threats to fund the campaign of Democratic candidates against Republicans. The confrontation has caused Tesla's value to fall by 150 billion dollars, a company that, since the beginning of the year, had already experienced a decline of more than 20%; it also threatens SpaceX's space missions and could affect Starlink's government contracts.
This symbolises a significant decline in Musk's capital, especially in relation to his cornerstone, Tesla, which, thanks to US tax cuts, managed to position itself as one of the leading electric car companies. This alliance was particularly significant because of Trump's potential support for Musk's vision of moving to fully autonomous cars in the United States, which was previously hampered by government controls and concerns about technological advances on the roads. Wedbush Securities analyst Dan Ives pointed out that Musk needs the regulatory environment that Trump provides and that this promise is now under threat. This is particularly evident in relation to the new regulatory frameworks being developed for car designs, which could affect the production of Musk's robot taxis, which began this month in Austin, Texas.
SpaceX relies heavily on government contracts worth tens of billions of dollars and has joint ventures with NASA related to transporting astronauts to the International Space Station (ISS) and launching satellites. SpaceX is also responsible for some high-profile national security projects that are now in jeopardy following Trump's warning that they would be cancelled and Musk's subsequent, then retracted, response that he would withdraw the Dragon space capsule, the first privately owned and operated NASA-certified spacecraft and crucial for transporting astronauts and supplies to the ISS.
Musk's far-right political views have led to a decline in important customers who have been put off by his rhetoric. These people are linked to environmental and liberal issues that they previously thought would be represented by the brand's values. The growing unease about Musk's attitudes has been highlighted by Tesla car owners, who have stated that they bought the vehicles before they were aware of the tycoon's behaviour.
The economic damage is also evident in the sales figures. In Europe, there has been a general increase in electric cars, but a 50% drop in Tesla's market share. The Morgan Stanley Bank study showed that 85% of investors saw Musk's involvement in politics as a major detriment to his companies.
Elon Musk also has plans to enter the artificial intelligence sector with the company XAI, which he hopes will compete with Open AI. This comes on the heels of the purchase of Twitter, now X, for 44 billion dollars in 2022, currently a relevant network for influential personalities and a favourite of conservatives, despite the fact that Trump no longer has as much involvement as in the past and prefers his own social network, Truth Social.
These episodes highlight a rift between the two personalities. Their relationship was strengthened during the last US election campaign, which offered the possibility of fulfilling their ambitions and building cutting-edge businesses and projects. However, despite appearances, from the outset, a quick end to this partnership, which harbours a strong power struggle, was predicted.