Shares of Tesla and SpaceX dropped by approximately 15% over a two-day period following the results of the US midterm elections. The shift in political power toward the Democratic Party has created uncertainty regarding the proposed merger of the two companies, which was previously planned for the first half of 2027.
Market analysts highlight that high interest rates, stock volatility, and a lack of investment are currently hindering the merger process. Furthermore, the new Democratic majority in Congress may increase regulatory scrutiny over the deal and potentially summon Elon Musk to testify regarding the geopolitical role of Starlink.
The market downturn also impacted the broader technology sector. The iShares Semiconductor ETF experienced its worst performance since 2020, while the Nasdaq 100 index fell by 6%. Investors are concerned that the new administration may impose stricter regulations on data centers and artificial intelligence infrastructure.
The political shift has affected regions critical to infrastructure development, including Texas and Georgia. Despite the relocation of corporate headquarters to Texas, the state elected a Democratic governor. Projections indicate that Texas is expected to account for up to 30% of data center development through 2030.
