Gina Hinojosa unseats Greg Abbott in Texas governor's race
Democrat Gina Hinojosa won the Texas governorship, ending a Republican hold dating to 1995, as Democrats also flipped the Senate seat and the state House despite heavy spending by Elon Musk.
Democrat Gina Hinojosa defeated Republican Gov. Greg Abbott in Texas, ending a Republican hold on the governor's office that dated to 1995. Her victory makes her the first Latina to serve as governor of the state. It came despite an election cycle in which Elon Musk spent heavily in support of Republican candidates and causes in Texas.
According to campaign finance data compiled by OpenSecrets, Musk spent at least $225 million in Texas and gave more than $445 million to Republican candidates and groups across the country this cycle. Texas is home to several of his businesses, including Tesla's headquarters, SpaceX's Starbase facility and the social media platform X, which gives his economic footprint in the state particular weight in political debates over industry and regulation.
The results extended beyond the governor's race. In the U.S. Senate contest, Democrat James Talarico defeated Republican Ken Paxton, marking the first Democratic Senate win in Texas since 1988. Democrats also took control of the Texas House for the first time since 2002. Republicans retained a 19-12 majority in the Texas Senate, leaving the chamber under GOP control.
Hinojosa's campaign centered in part on data centers. She pledged a moratorium on approvals for all data centers, a freeze that would remain in place until the Legislature passes new protections. The governor's office under Abbott had already paused new data center permits in September pending an audit. The scope and duration of any freeze Hinojosa would impose remain unclear.
The issue ties directly to a major project in which Musk's companies are involved. Terafab, a chip plant planned for Grimes County, has a first phase estimated at $16.8 billion. The full project could cost between $55 billion and $119 billion across four phases. The first phase is expected to create 3,000 jobs and has received a $30 million state grant as well as a school tax break under the JETI program. Future phases may face closer scrutiny and carry cost risks.
Hinojosa also sued on Oct. 19 to gain access to communications between Abbott and Musk. The suit targets the JETI tax break, more than $54 million in grants tied to SpaceX, and funding connected to Starlink. A judge ordered an inspection of the records on Oct. 26, but an appeals court stayed that order the following day. Abbott's office has described the lawsuit as a baseless stunt.
Financial markets reacted to the election results. On Nov. 4, Tesla shares fell 3.3 percent and SpaceX shares fell 3.8 percent. Any causal link between the election and those declines has not been established. With Democrats now in control of the Texas House and the governorship, and a Democratic Congress possibly ready to scrutinize Musk's companies, the company is weighing a possible merger between Tesla and SpaceX.
Source: fortune.com
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