Musk Inc is under serious threat

Subscribe to enjoy similar stories. UNTIL RECENTLY Elon Musk had little need to look over his shoulder. He once described competition for Tesla, his electric-vehicle (EV) company, as “the enormous flood of gasoline cars pouring out of the world’s factories every day", rather than the “small trickle" of other EV-makers.

SpaceX, his rocket firm, had so undercut and outwitted the bloated aerospace incumbents that it had developed an almost invincible aura. Yet if Mr Musk can tear himself away from the intoxication of shredding the American government, he may notice something. It is not just that the political firestorms he has whipped up this year are singeing his companies’ brands.

It is that the two businesses that underpin his corporate empire—accounting for around 90% of its value and probably all its profit—are facing increasingly stiff competition. The world’s richest man has lost focus—and now has a target on his back. Start with SpaceX.

Last year it conducted five out of every six of the world’s spacecraft launches. Through its Starlink division, it owns 60% of satellites in space. In December it sold shares at a valuation of $350bn, two-thirds higher than its previous level.

Starlink, its main profit engine, is on track to generate more than $11bn of revenue this year and $2bn of free cash flow, says Chris Quilty of Quilty Space, a consultancy. Now, however, Mr Musk’s bomb-throwing interventions are alarming SpaceX customers, and at a time when rivals are growing more capable. His on-again, off-again threats to end Starlink’s support for Ukraine have raised the difficult question of trust.