Elon Musk is expanding his technological ambitions into the gas turbine market, aiming to address supply bottlenecks that have slowed the deployment of power generation infrastructure essential for expanding data centers. SpaceX, Musk’s aerospace company, plans to manufacture turbine blades and vanes in-house, potentially accelerating delivery timelines for gas turbines that are currently backlogged until 2030 or beyond.
The surge in demand for electricity driven by the growth of data centers has led developers to install dedicated gas-fired power plants, as overloaded electrical grids have become a major constraint. The heavy-duty turbine market, dominated by established manufacturers such as GE Vernova, Siemens Energy, and Mitsubishi Power, faces significant delays due to the complex engineering and lengthy testing processes required. According to S&P Global, these three companies account for more than three-quarters of the installed base of heavy-duty turbines.
Musk believes SpaceX can reduce these delays by as much as 18 months. However, other challenges remain, including a shortage of specialized installation teams necessary to bring gas-powered generation facilities online. Despite these hurdles, success in this endeavor could have far-reaching implications, as it would increase electricity availability and thus support the expansion of data center capacity. SpaceX itself benefits financially from data center power supply, currently earning substantial revenue through agreements with clients such as Anthropic and Google—revenues from these two alone are projected to represent roughly 25% of SpaceX’s total income next year, according to S&P Capital IQ.
The turbine components Musk plans to produce may also have dual applications, potentially serving in rocket engines and other aerospace technologies developed by SpaceX. To navigate sector bottlenecks, Musk has reportedly invested in APR Energy for $1 billion, a company specializing in mobile gas and diesel turbine power generation. SpaceX has utilized mobile turbines in Mississippi and is working with local regulators to replace them with a permanent power plant.
Musk’s move into the turbine market presents a challenge to incumbent parts manufacturers, including Howmet Aerospace, whose stock has declined by about 20% since mid-August but still trades at a high multiple relative to earnings. While Musk’s entry could disrupt the established supply chains, it might also incentivize traditional manufacturers to ramp up production and innovation, easing existing sector constraints.
Industry observers suggest that even if Musk does not succeed in capturing significant market share, the mere prospect of competition from SpaceX could pressure existing suppliers to accelerate delivery schedules and expand capacity, potentially easing the supply bottlenecks limiting the gas turbine sector and, by extension, data center expansion.