Elon Musk’s companies Tesla and SpaceX faced heavy stock market losses on Wednesday following Republican defeats in the US midterm elections, raising concerns about increased government scrutiny.
The companies were initially expected to lose a combined $215 billion in market value, with shares projected to fall between 6 percent and 7 percent at the opening bell.
SpaceX shares were also expected to drop below their initial public offering (IPO) price.
According to Bloomberg, both companies faced selling pressure as Democrats moved towards taking control of Congress, potentially threatening Musk’s business interests.
Musk spent hundreds of millions of dollars supporting Republican candidates during the midterms, particularly in Texas, where Democrats secured major victories.
Investors had expected Republican wins to benefit Tesla and SpaceX through favourable policies, including the expansion of artificial intelligence data centres.
However, Democratic control of Congress has raised concerns about tougher regulations and possible investigations into Musk’s companies.
The election results could also complicate a proposed merger between Tesla and SpaceX, which Musk discussed during recent earnings calls.
