Donald Trump and Elon Musk’s unholy alliance

Almost immediately after Donald Trump’s election as the 45th President of the United States were the political analysts and commentators declaring the end of the country’s green energy movement and a return to the days of North American coal.

There were many understandable, if one dimensional, reasons to come to this conclusion, after all a cornerstone of the campaign was based on ripping shreds into wind energy and Trump doffing his miner’s hard hat at rallies in former coal and steel producing areas.

“At forty-dollar oil it’s not economic so they are going to have to do a subsidy. Wind is a very expensive form of energy and it’s got problems with storage and lots of other things…” explained Trump at an Iowa rally in November 2015.

This is a telling quote that we will revisit later.

In his inauguration speech, President Trump used the country’s industrial past as a graphic example of an America that has, in his eyes, lost its way.

“One by one, the factories shuttered and left our shores, with not even a thought about the millions upon millions of American workers left behind… [we] spent trillions of dollars overseas while America’s infrastructure has fallen into disrepair and decay,” Trump said.

And many business leaders were against Trump’s election, non-more so than the Silicon Valley set.

The fact that nearly all business leaders in the hi-tech hub were vocally against his running for president combined with his reputation to hold a grudge, made this a logical summary.

The immediate conclusion of all this furore was that Trump is anti-renewable energy and anti-Silicon Valley.

However, the Silicon Valley blueprint of world leading innovation and global manufacturing prowess is surely what the new president is wanting to bring back to desolated regions of the country.

While the outsourcing of manufacturing to Asia – such as Apple’s electronics – is no doubt a contentious issue, Silicon Valley’s success over the last two decades is a spirit the US will need to harness and replicate.

It was clear this was the way forward for the Trump administration after one of its first acts was to invite all the business leaders from Silicon Valley to a lunch meeting and the creation of a business advisory council.

“I am here to help you folks do well,” the president declared at the meeting.

“I want you to keep going with the incredible innovation… there’s nobody like you in the world,” he added.

Leaders in attendance included Apple CEO, Tim Cook, Amazon’s Jeff Bezos, Facebook’s Sheryl Sandberg, Microsoft’s Satya Nadella, and, of course, Elon Musk of Tesla, Space X and SolarCity.

The only notable leader that was not invited was Twitter’s CEO, Jack Dorsey (after a dispute over a ‘Crooked Hillary’ emoji symbol), and the only refusal was from Uber’s chief, Travis Kalanick, who refuses to do business with the new administration.

Musk took an opposing and pragmatic approach.

His public embracing of the president’s olive branch to the country’s leading tech companies saw notable online abuse hurled at him.

“I understand the perspective of those who object to my attending the meeting, but I believe at this time that engaging on critical issues will, on balance, serve the greater good,” Musk said in response.

Mutual need

After little over three months in the job, it is becoming clear that Trump is as useful to Musk, as the Tesla CEO is to the President of the United States.

The formation of an unholy alliance to progress both of their causes is has been formed.

Tesla is at a critical juncture with the Gigafactory now producing lithium ion batteries and production of the make-or-break Model 3 beginning in June. With the company burning through cash at the most rapid rate of its existence to pay for the scaling up of its new car, Tesla could do with friends in high places.

It would be wrong to suggest Trump is influencing Elon Musk’s trajectory for Tesla. After all, it was the choice of Tesla executives many years ago to base manufacturing for its vehicles and lithium ion batteries in the US.

Domestic manufacturing has been at the core of everything Musk has been involved in. This was also seen at Space X which makes rockets on the outskirts of Los Angeles or SolarCity which manufactures solar panels in Buffalo.

It is all a strategy of controlling each company’s respective supply chains and with it the quality of their products. The net result of this is the return of the types of jobs that Trump was elected for.

The Tesla Gigafactory will employ over 6,000 people at its peak, most of whom will be locals from the northern Nevada area and surrounding states. The company is also planning its second, third and fourth Gigafactories for, one would estimate, between 2020 and 2030 with the Tristate area (New York, New Jersey, Connecticut) and Europe (France, UK) being touted as possible locations.

No one could have ever predicted ten years ago that in 2017 Los Angeles’ residents would be making space rockets from scratch or Fremont locals would be forming and stamping metal sheets into a an electric vehicle.

Made in America

These are jobs that the US was interviewing for a generation ago not in 2017.

“Will Tesla Model 3 be most ‘made in America’ car, beating Toyota Camry?”, Twitter user, Don Barbieri asked Elon Musk.

“Good chance it will be,” the CEO responded.

There is an argument that Elon Musk was making America great again, way before Donald Trump came on the scene.

And it is momentum that the South African-born entrepreneur is using to his advantage.

After taking on Space, the sun and the ground, Musk is now going sub-surface with a tunnel boring company after being stuck in one too many of Los Angeles’ traffic jams.

It did not take long for a large hole to be discovered in the Space X car park – the result of a tunnel boring experiment that has kick started Musk’s fourth major venture.

The scale of the Musk’s ambition is Victorian-esque and his appetite for risk is unrivalled, seeking to tackle the population’s biggest problems with innovation and scale.

By tackling the oldest industries with modern technology, Musk is combining the Steve Jobs blueprint with that of Isambard Kingdom Brunel, one of the greatest influences on the industrial revolution.

With Trump eager to get the balling rolling on widespread construction, it’s clear that Elon Musk is migrating towards the centre of his strategy.

And despite the President’s attack on renewables and a public backing of coal, even the most staunch of his opponents will recognise his true mantra: if it doesn’t make dollars, it doesn’t make sense.

Therefore, do not expect to see coal mines to return to the world’s biggest economy anytime soon or wind turbines already in use to being torn down. Trump’s policies will not be this transparent.

To revisit the complete quote from earlier:

“Wind is a very expensive form of energy and it’s got problems with storage and lots of other things… But I want to see [us do] whatever we can do [to get] away from the [dependency] on the Middle East,” the president said in his campaign.

While President Trump finds his feet, his policies may not be very clear, but his ethos is becoming more so: New business, new ideas.

And with Elon Musk as his unofficial right hand man, an alliance that many never predicted could now be America’s greatest asset.

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