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Elon Musk directed at least $225 million of his midterm spending to Texas, according to OpenSecrets data NPR reported. Texas is home to the headquarters of Tesla and SpaceX, and on Tuesday its voters handed Democrats the governor\u2019s office, a U.S. Senate seat, and the state House anyway.<\/p>\n
Democrat Gina Hinojosa unseated three-term Gov. Greg Abbott, becoming the state\u2019s first Latina governor and ending a Republican hold on the office that began in 1995. James Talarico defeated Republican Ken Paxton, the first Democratic U.S. Senate win in Texas since 1988. Democrats also\u00a0won control of the Texas House\u00a0for the first time since Republicans took it in 2002.<\/p>\n
For Musk, the result replaces a governor who championed his Texas expansion with one who sued to see Abbott\u2019s communications with him and has promised to freeze data center approvals. Tesla, SpaceX, and Terafab, the $16.8 billion chip plant they are building in Grimes County, all depend on state cooperation for their next phase in Texas.<\/p>\n
Musk gave more than $445 million to Republican candidates, PACs, and outside groups this cycle, making him the top donor of the midterms, according to OpenSecrets; other tallies run higher. Since May 2025, he has given more to federal political groups than George Soros has personally given in his lifetime, a Fortune analysis found.<\/p>\n
What a Democratic Texas means for Musk\u2019s companies<\/p>\n
Texas hosts Tesla\u2019s Austin headquarters and Gigafactory, SpaceX\u2019s Starbase launch site, and X, which became part of SpaceX when SpaceX merged with xAI in February. Tesla, a Fortune 500 company, is unlikely to see immediate manufacturing disruptions.<\/p>\n
It could face more scrutiny of its Autopilot and Full Self-Driving technology and its planned Cybercab robotaxi rollout, especially with Democrats also winning both chambers of Congress. Democratic lawmakers could also push for a closer look at Musk\u2019s companies and their government relationships.<\/p>\n
SpaceX\u2019s Texas expansion and its AI infrastructure ambitions could meet tougher environmental reviews and more contentious debates over electricity, water, and data center development. Hinojosa has made that fight central. \u201cI will issue a moratorium \u2014 a ban \u2014 on all data center approvals,\u201d she said in an Oct. 22 video, pledging to keep it in place until the Legislature passes new protections, the Texas Tribune reported.<\/p>\n
Abbott himself paused new data center permits in September pending a grid audit. The open question for Musk is how long, and how broadly, a Hinojosa freeze would apply.<\/p>\n
Why Terafab\u2019s incentives face new questions<\/p>\n
Terafab\u2019s first phase represents a capital investment of more than $16.8 billion and is expected to create 3,000 jobs, according to Abbott\u2019s office. The full project could be built in up to four phases at a total cost of $55 billion to $119 billion, Manufacturing Dive reported.<\/p>\n
The state has extended a $30 million Texas Enterprise Fund grant, and the plant qualifies for the Jobs, Energy, Technology, and Innovation (JETI) program, which reduces school property taxes for large projects. The election doesn\u2019t automatically cancel those commitments, but closer scrutiny of incentives and environmental requirements could raise costs or slow later phases.<\/p>\n
Terafab is a chip plant, not a conventional data center. Its energy and infrastructure demands could still draw attention from officials concerned about industrial expansion, and Musk has said the facility will produce AI chips at scale.<\/p>\n
The lawsuit that previews Hinojosa\u2019s approach<\/p>\n
Hinojosa challenged Abbott\u2019s relationship with Musk before she won. On Oct. 19, the first day of early voting, she sued for access to unredacted communications between Abbott\u2019s office and Musk and his companies. Her lawsuit says the governor\u2019s office described some of those records as \u201cintimate and embarrassing.\u201d<\/p>\n
She pointed to a $1.66 billion JETI tax break tied to Terafab, more than $54 million in state grants to SpaceX, and Abbott\u2019s push for the state broadband office to award Starlink $110 million upfront from federal funds, a move that triggered an audit of the office. Abbott\u2019s office called the suit \u201ca baseless stunt.\u201d<\/p>\n
State District Judge Catherine Mauzy ordered Abbott\u2019s office on Oct. 26 to let Hinojosa inspect the records, and the 15th Court of Appeals stayed that order the next day. Bloomberg Government separately reported that Mauzy had donated $500 to Hinojosa\u2019s campaign in June.<\/p>\n
Starting in January, Hinojosa will control state appointments, the veto, and the governor\u2019s office that administers the Texas Enterprise Fund. Republicans kept their 19-12 majority in the Texas Senate, but Democrat Vikki Goodwin\u2019s win in the lieutenant governor\u2019s race gives the party the chamber\u2019s presiding officer.<\/p>\n
What to watch next<\/p>\n
Shares of Musk\u2019s two public companies fell the day after the election while the broader market rose. Tesla closed down 3.3% and SpaceX down 3.8% on Nov. 4, according to Yahoo Finance.<\/p>\n
The timing doesn\u2019t prove investors were reacting to Texas. But Wells Fargo\u2019s chief equity strategist, Ohsung Kwon, had warned that a Democratic win in the governor\u2019s race could be a \u201cleft-tail event\u201d for the AI trade, CNBC reported.<\/p>\n
Musk is also weighing a merger of Tesla and SpaceX, a deal that Democratic majorities in Congress could now scrutinize. Fortune has reported on what the merger talks reveal about his power.<\/p>\n
Hinojosa takes office in January, the same month lawmakers return to Austin. The next tests are how far her data center freeze reaches, whether Terafab\u2019s JETI agreements draw legislative review, and whether the fight over Abbott\u2019s Musk records outlasts his administration.<\/p>\n
#Elon #Musk #spent #225M #Texas #governorelect #sued #Abbott #emails #won<\/p>\n","protected":false},"excerpt":{"rendered":"
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