Analysis
Elon Musk lost roughly $113 billion over two days as Tesla and SpaceX shares sold off following the U.S. midterm elections, according to Fortune, which tracked the move through the Bloomberg Billionaires Index.
Musk's net worth fell about $33.5 billion on Wednesday and another $79.7 billion in Thursday's selloff, as investors unwound bets tied to his AI and space businesses the same week Democrats flipped the House.
What happened to Tesla and SpaceX stock
Tesla shares fell 3.3% and SpaceX shares fell 3.8% on Wednesday alone, even as the S&P 500 rose 1.6% and Amazon and Apple each jumped more than 5%.
“Tesla shares fell 3.3% and SpaceX shares fell 3.8% on Wednesday alone, even as the S&P 500 rose 1.6% and Amazon and Apple each jumped more than 5%.”
The divergence widened by Thursday: Tesla and SpaceX's combined market capitalization fell from about $3.5 trillion on election night to $3.04 trillion by Thursday night, a two-day loss of roughly $456 billion.
SpaceX closed Thursday at a $1.68 trillion valuation, about 87% of its midterms-night level, and Tesla closed at $1.36 trillion, about 86% of its prior mark.
Why the selloff hit Musk's companies specifically
The broader market didn't fall with Musk's stocks. The Dow rose 3% on Wednesday -- its best post-midterm performance in 44 years -- before giving back 2.9% on Thursday as investors also sold AI-adjacent chip names such as AMD and Micron. CFRA Research analyst Keith Snyder called the Musk-specific move a knee-jerk reaction to the election, adding that "the nail that sticks out gets hammered first." Snyder also flagged that Democrats could slow down FCC matters affecting Musk's businesses, though he said he doesn't expect major FCC action given the chamber's current composition.
Political scrutiny adds to the pressure
The timing compounds Musk's exposure. Fortune estimates Musk spent between $427.5 million and $483 million backing Republican candidates this cycle. Incoming House Oversight Committee chair Robert Garcia has vowed to investigate corporate corruption, and a spokesperson said Musk's role in the Department of Government Efficiency is something they plan to investigate. Senator Richard Blumenthal separately sent Musk a letter asking about SpaceX's Department of Defense contracts and its ability to restrict Starlink access. Pulse has previously covered SpaceX's financing and merger speculation with Tesla; that proposed combination is now harder to execute. Wedbush analyst Dan Ives wrote that a Tesla-SpaceX merger "faces a much tougher regulatory roadmap" now that Texas, home to both companies' operations, turned blue in the midterms.
The counterweight: a political-risk repricing, not a business one
Nothing in the reported selloff points to a change in Tesla's vehicle demand or SpaceX's launch cadence, Starlink growth or government contract pipeline -- the move looks like a repricing of political risk around Musk personally, not a disclosed change to either company's unit economics. Tesla, incorporated in 2003 by Martin Eberhard and Marc Tarpenning before Musk became chairman and later chief executive, and SpaceX, founded by Musk in 2002, both remain far above their pre-2024 valuations even after this week's drop. The risk is concentration: both companies' value increasingly depends on investor confidence in Musk's political standing, not just their own fundamentals.
What to watch next
Blumenthal's inquiry into SpaceX's Starlink restriction powers and Defense Department contracts is the concrete near-term catalyst -- a response, or a hearing date, would move SpaceX's private marks independent of Tesla's public stock price. The FCC's posture under a Democratic-controlled House is the second item Snyder flagged, even though he doesn't expect fast action there.