Musk’s Regulatory Woes Fade Under Trump Administration

Elon Musk’s numerous regulatory challenges have begun to dissipate since President Donald Trump’s return to office, with federal agencies dropping cases, canceling investigations, and undergoing significant staffing changes that benefit the world’s wealthiest man and his business empire.

The shift comes as Musk transitions from his role as a White House efficiency adviser back to focusing on his companies, leaving behind a transformed regulatory landscape potentially worth billions in avoided liabilities.

Justice Department Drops Key Cases

Since January, the Trump administration has taken decisive steps to resolve regulatory matters involving Musk’s companies, including the Justice Department’s dismissal of a case against SpaceX that had alleged discrimination against refugees in hiring, according to NBC News.

In a statement to NBC News, Harmeet Dhillon, Trump’s assistant attorney general for civil rights, cited multiple factors for dismissing the case, including “the pending injunction and constitutional challenge to the original proceeding.”

The Labor Department has also canceled a planned civil rights review of Tesla, Musk’s electric vehicle company, following a January 21 executive order from Trump that halted operations of the Office of Federal Contract Compliance Programs, which reviews government contractors for civil rights compliance.

Labor Relations Board Shows Sudden Interest in Settlement

Another significant development involves the National Labor Relations Board, which has suddenly expressed interest in settling a case that has been pending since 2022 regarding SpaceX’s firing of employees who sent an open letter about working conditions.

The NLRB, now under Trump’s control, made a court filing on April 23 indicating its desire to “potentially settle the legal disputes currently pending between the NLRB and SpaceX,” a marked change in approach that benefits Musk’s company.

Tom Moline, one of the fired SpaceX employees, expressed concern about the NLRB’s sudden change of heart, telling NBC News, “Anyone could see that there’s conflicts of interest there, in my opinion.”

Broader Pattern of Regulatory Retreat

Beyond the explicitly dropped cases, more than 40 other federal agency matters involving Musk’s companies have shown no public action for months, raising questions about whether these investigations have become dormant, according to an NBC News review.

These matters range from safety investigations into Tesla’s “self-driving” features to alleged workplace safety violations at SpaceX, with a potential total of more than $2 billion in liability at stake, according to a recent report by Senate Democrats.

Cary Coglianese, a law professor at the University of Pennsylvania, noted that while the Trump administration is generally slowing down enforcement processes, “the pattern is suspicious if it holds,” particularly given Musk’s dual roles as government adviser and business leader.

Favorable Regulatory Changes

In addition to dropped cases and dormant investigations, Musk’s companies have benefited from changes to written regulations under the new administration.

Last month, the Transportation Department lowered the threshold for self-driving car companies like Tesla to report safety incidents, and this week, the Federal Aviation Administration granted permission for SpaceX to perform 25 launches per year of its massive Starship—a fivefold increase—despite environmental concerns and impacts on air travel.

These regulatory changes come as Musk is positioned to benefit from potential new government contracts for his satellite internet service Starlink and his rocket company SpaceX, with Reuters reporting that SpaceX is a front-runner to help build Trump’s “Golden Dome” missile defense shield.

Conflict of Interest Concerns

Musk’s dual role as both White House adviser for the Department of Government Efficiency (DOGE) and CEO of multiple companies facing federal regulatory scrutiny has raised significant ethical concerns, as noted by Politico.

Unlike previous White House advisers, there’s no evidence that Musk has filed paperwork outlining steps to avoid conflicts of interest, though he has reportedly committed to recusing himself from potential conflicts.

“As a citizen, I have to say it looks like there might be some special treatment, and as a citizen, I should probably be worried about even the appearance of special treatment,” Coglianese told NBC News, expressing concern about the legitimacy of government actions benefiting Musk’s businesses.