Elon Musk loses over $40 billion as tariffs wreak havoc on his business empire

In recent months, the economic landscape has drastically shifted for Elon Musk, primarily due to the impact of President Trump's tariffs. As tariffs were introduced, Musk's fortune began to drop significantly, plummeting by over $40 billion since late December when it reached a peak of over $400 billion. This economic turmoil has deeply affected Tesla, SpaceX, and his other ventures, each facing a myriad of challenges stemming from increased costs and supply chain issues caused by the tariffs imposed on foreign imports. Tesla, which relies heavily on global supply chains, found itself particularly vulnerable. Data from the end of last year indicated that between 20% to 25% of car parts were sourced from foreign suppliers, including 40% of electric battery materials coming from China. The introduction of tariffs not only escalated production costs but also placed significant pressure on Tesla's stock, causing it to fall by 17% since the tariffs were announced. Experts have optimistically noted that Tesla might fare slightly better than some rivals but have warned that brand equity deterioration could worsen if the tariffs trigger a recession. SpaceX, another one of Musk's major business ventures, is also feeling the heat of the tariffs. Sourcing satellite components from abroad, particularly from regions heavily impacted by tariffs like Vietnam and Thailand, has introduced additional financial burdens. Significant partnerships with Taiwanese suppliers have been affected, further complicating their operational stability. SpaceX's revenue, heavily reliant on the international market for its Starlink satellite internet business, is also at risk, reflecting the potential fallout of deteriorating international relations with foreign governments. Musk's emerging artificial intelligence company, xAI, is also grappling with the consequences of these tariffs. The company merged with Musk's social media outlet, X, expanding its operations but simultaneously facing high costs of parts and materials sourced from regions affected by tariffs. Experts predict that the sector as a whole will likely suffer from the increased costs associated with tariffs, making Musk's ventures even more vulnerable as the economic landscape continues to evolve. Reflecting on his concerns over the enforcement of tariffs, Musk suggested a desire for a zero-tariff agreement across the U.S. and Europe. As these events unfold, the interplay of tariffs and economic performance is showcasing the interdependent nature of Musk's empire, demonstrating how shifts in one sector can create ripple effects across his diverse business interests.