Elon Musk spent $224 million to influence Texas Senate race - What Democrat win means for Tesla, SpaceX and data centers

The US midterm election 2026 results are in, barring a few seats where the counting of postal ballots is still ongoing. But the direction is clear - Tuesday’s result was a ‘blue tsunami’ and not a ‘blue wave,’ as the exit polls had predicted. Democrats are on track to take control of both the House of Representatives and the Senate in January.

While the answer to ‘who is the biggest winner’ is clear, the same cannot be said about ‘who is the biggest loser in the 2026 US midterm elections.’ That is because opinions are divided on whether it is Donald Trump, who has been reduced to a lame duck for the remainder of his term, JD Vance, who was considered the frontrunner to succeed Trump in 2028, or the Republican Party. Musk's bet that failedMany have also added another name to the list - that of Tesla CEO Elon Musk.

While he was not on the ballot, the world’s richest man had clearly picked his sides and showered a fortune on Republican candidates in their election bid. Musk, who spent a record $474 million on the midterms, funneled $224 million, or nearly half, into Texas alone, and the results there have hurt him the most. The most notable being the Senate race, where Musk was drumming up support for Republican Ken Paxton.

But on Tuesday, James Talarico became the first Democrat to be elected to the Senate from deep-Red Texas since 1988. Musk had launched several personal attacks on Talarico, including claiming that "Talarico will vote to trans your kids."On Tuesday, Talarico addressed Musk in his victory speech."We just sent a message to every billionaire mega-donor, every trillionaire mega-donor, every corrupt defender of this broken political system in this state, in this country.

Power belongs to the people," Talarico said. "The real fight in this country is not right versus left; it is top versus bottom."Musk’s second blow of the day came in the form of Gina Hinojosa, the Democratic nominee who won the race for Texas Governor. Musk was betting on Greg Abbott, the Republican incumbent governor who was seeking a fourth term in office. But on Tuesday, Hinojosa scripted history, becoming the first Democratic governor of Texas since Ann Richards in 1991, and only the third woman to hold the office.

Why Texas matters for MuskBeyond the loss of face, the results in Texas have implications for Musk’s business empire, including Tesla and SpaceX. The South Africa-born billionaire who now calls Texas his home has also based his key businesses there. Tesla operates its largest US vehicle factory outside Austin, and SpaceX launches rockets from its Starbase complex in South Texas.

In addition to this, Musk was also on track to invest more in Texas for in AI and semiconductor manufacturing. Musk’s future investments, especially in AI infrastructure in Texas, are likely to run into trouble with Governor-elect Hinojosa, who, throughout her campaign, called for a moratorium on data centers until new laws are established in the state. On Tuesday, as results came in, Musk wrote on X, “Data centers in space looking pretty appealing right now."