Elon Musk is becoming a liability for his own businesses

SpaceX just pulled off an audacious, successful launch of its Starship rocket booster. The event, which occurred Sunday, is a massive moment for Elon Musk’s space exploration firm, and could kick-start the next phase of the space revolution.

But California’s Coastal Commission won’t be playing any role in it. Last week the organization rejected a proposal to give SpaceX permission to launch up to 50 rockets daily from an Air Force base under its jurisdiction. (The decision of the Coastal Commission can, and likely will be, overruled by others, but it’s an important stake in the ground.)

The issue wasn’t anything to do with SpaceX as a company, or its technical prowess. SpaceX was, after all, days away from launching and landing a rocket in the same place for the first time when the commission issued its rejection.

Instead, it was the company’s figurehead at fault. “Elon Musk is hopping about the country, spewing and tweeting political falsehoods and attacking FEMA while claiming his desire to help the hurricane victims with free Starlink access to the internet,” California Coastal Commissioner Gretchen Newsom said when she passed down the rejection notice. Newsom, who bears no relation to California Governor Gavin Newsom, didn’t mince her words, and her comments highlight just how toxic the Musk brand can be—to the extent of stymying development by his companies.

This isn’t the first time Musk’s abrasive personality and eagerness to foist his own political beliefs onto people have gotten his companies in trouble. The U.K. government decided not to invite Musk to an investment summit held today that has otherwise attracted many big business leaders. The decision was made last month, with the BBC reporting Musk was deliberately snubbed because of his public comments about race riots that roiled the country over the summer. And it can be easy to forget that Musk recently lost an appeal to remove his so-called “Twitter sitter,” a company lawyer that oversees every post he makes on social media about Tesla, following an agreement he made with the Securities and Exchange Commission over allegations that Musk posted fraudulent tweets that misled investors into his company.

Musk had sought to appeal that decision in the Supreme Court and to lift the need for his posts to be checked, but the appeal was immediately dismissed out of hand by the court in April this year. Given Musk’s abrasive behavior toward authority, it’s likely that decision wasn’t an altogether difficult one. “I think Musk’s image has been damaged,” says Cary Cooper, professor of organizational psychology at the University of Manchester business school. The way in which Musk has so stridently stepped behind Donald Trump, and the antagonistic way in which he interacts with others, is having a negative impact on his business pursuits, says Cooper.

“He’s both a liability and an asset, and it is hard to know which outweighs the other,” adds Anupam Chander, professor of law and technology at Georgetown University.

The issue of Musk’s polarizing personality hasn’t escaped the notice of others, either. “Tesla can’t sell its cars due to Elon’s behavior,” wrote investment advisor Ross Gerber in April. “Let’s stop blaming the Houthi rebels or German environmental terrorists. Or a recession that never came. Or interest rates. Only one person is responsible for this.”

Yet the same qualities that put some partners—including government representatives and courts making judgements on what he can and can’t do—are the same ones that help energize much of his base, and have resulted in some of the extraordinary developments his companies have been responsible for.  “Even while Musk might put off some customers and politicians, it’s not clear that if Tesla or SpaceX were not run by someone else they would still draw the same ardent followers and attract loads of free press,” says Chander.

But it’s consumers and colleagues alike that are being put off by what Musk does and how he interacts. Cooper says he’s heard people who say they won’t buy a Tesla because of its links to Musk anymore. And his interactions with government have become much more strained. “Government likes to deal with people who are fairly stable,” says Cooper—suggesting Musk isn’t. “They know what to expect from them. In the past, he’s been so entrepreneurial that was fine with government, and he stayed away from the political arena, and now he’s firmly engaged in the political arena.” That has put people off.

It all adds up to a complicated legacy, and one that continues to be written with every step back and advancement. “He has also pressed both companies to achieve things that many of us thought impossible—but he’s also promised stuff he’s never delivered,” says Chander.

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