(Bloomberg) -- Elon Musk’s deputy Steve Davis has spent more than 20 years helping the billionaire cut costs at businesses like SpaceX, the Boring Company and Twitter — making the engineer by training a natural choice for his new role at Musk’s Department of Government Efficiency, or DOGE for short.
Davis is helping recruit staff at DOGE, Musk’s effort to reduce government waste, in addition to his day job as president of Musk’s tunneling startup, the Boring Company. At Boring, Davis has a reputation for frugality, signing off on costs as low as a few hundred dollars, according to people familiar with the conversations — unusual for a company that has raised about $800 million in capital. He also drives hard bargains with suppliers of products like raw steel, sensors, or even items as small as hose fittings, said the people, who asked not to be identified discussing private information.
His favorite directive for staff doing the negotiations: “Go back and ask again.”
Davis has emerged as a key figure in Musk’s stable of company executives. An aerospace engineer by training, he’s spent time at SpaceX and Boring, and was brought in to help with the takeover of Twitter (now called X), where Musk and his team dramatically cut costs and headcount. Davis embraced the work with such fervor that for a while, he slept at the Twitter offices with his partner and their newborn baby.
DOGE is not an official government agency. Its authority and mandate are still largely unclear. But Davis’ presence suggests that the program could recreate some of the aggressively frugal, and at times chaotic, transformation efforts that have become a hallmark of Musk’s leadership in the private sector.
Davis started working for Musk in 2003, when he joined SpaceX, at the time a new company. He had just earned a master’s degree in aerospace engineering from Stanford University, and distinguished himself at the startup by solving hard engineering problems. At one point, Musk tasked the engineer with finding a cheaper alternative to a part that cost $120,000. Davis spent weeks on the challenge and figured out how to do it for $3,900, according to a biography of Musk. (Musk emailed back one word: “Thanks.”)
Davis stuck with Musk, and by 2016 was leading the Boring Company, a startup that aims to “solve traffic” with underground transit. Boring has built a handful of short tunnels in Hawthorne, California; greater Austin and Las Vegas. Davis, an avid reader who can quote Ayn Rand, brought rigor and some whimsy to the enterprise, people who worked with him say. He gave several of the company’s massive boring machines literary names, such as Prufrock.
Davis’ interactions with the government weren’t always positive. Boring, which must navigate a morass of national, state and local rules to build its tunnels, has run into major regulatory challenges — particularly around environmental requirements that dictate when and if the first shovel can hit the ground. Neighbors have also been a challenge. At one point, Davis was on track for a proposed project in Los Angeles, but nearby residents got wind of the project and sued — successfully scuttling the endeavor.
Working in Las Vegas created its own set of regulatory run-ins for Boring. Tunnels the company built to connect the convention center in Las Vegas to two nearby hotels, the Wynn Encore and the Westgate, still aren’t open to the public, more than a year after their completion. The Nevada Occupational Safety and Hazard Administration fined Boring $112,504 after an investigation into conditions during construction. Complaints from workers included toxic muck falling from overhead conveyor belts and an overloaded bin collapsing and disgorging its contents across the work site.
Chafing at government rules has been a recurring theme for Musk, whose net worth recently surpassed a record $400 billion. Aside from Boring’s challenges, SpaceX and Tesla have had their own issues with regulators, ranging from launch approvals to mask mandates. Critics of DOGE have speculated that the billionaire and his associates could use their influence to, say, lower budgets for regulatory bodies that have put up road blocks for his companies. Asked about Musk’s potential conflicts of interest, President-elect Donald Trump said that Musk will put the interests of the country first.
When Musk bought Twitter in October 2022, he deputized Davis to help cut costs, trim staff and rein in what Musk viewed as an overly liberal environment. Davis and his family slept in a makeshift bedroom at the company’s headquarters during crunch time, as Musk told staff to be “extremely hardcore.”
At the time, some people speculated that Davis would become CEO of Twitter. Instead, Davis returned to Boring, which has its main facilities in Las Vegas and in Bastrop, Texas, near Austin.
There, he has burnished his reputation as a cost-cutter and hard-driving boss. Davis has tended to spend more time in Las Vegas than in Bastrop, where he stays in a mobile home while in town, alongside the mobile homes of other workers. During those times, he would appear silhouetted through the window, often talking urgently into his phone until late at night while pacing around the kitchen table, according to people familiar with the company.
Former employees recount tales of being sent on flights between Austin and Las Vegas to collect or drop off a needed part, such as sensors for the tunnel boring machines. The company maintained such strict deadlines that Davis sometimes preferred to get the parts the same day rather than wait for next-day-air commercial shipping.
Former employees recall the consternation that erupted when a key part got waylaid en route to Las Vegas in a hotshot truck, a vehicle used to transport small freight from point to point. The truck, which Boring was monitoring remotely, made an unexplained stop for several hours in Arizona. Pressure to meet one of Davis’ deadlines was so intense that the Boring Company paid for a relative of an employee who lived in the area to go track down the truck and urge the driver to get back on the road.
Davis often scheduled meetings at 7 p.m. or later for engineers, some of the people said. He would typically participate remotely. One person who spoke with him frequently by phone said he would aim to multitask during meetings, eating while on a call.
Multitasking has proved a Davis signature, dating back to his student days. While he was working on his doctorate in economics at George Mason University in Fairfax, Virginia, Davis was working full time at SpaceX and owned a frozen-yogurt shop called Mr. Yogato in Washington’s Dupont Circle. Alex Tabarrok, one of Davis’ professors, remembers him juggling the multiple roles.
“I told him, ‘Look, you’re getting a Ph.D., you can’t be having a job and running a business at the same time,” Tabarrok recalls. “Focus on getting your Ph.D.”
But Davis declined to give up any of his pursuits, at one time incorporating business trends at Mr. Yogato into an academic paper and bringing some yogurt into class for sampling. Tabarrok can’t recall Davis’ grades, but says he stood out anyway. He “had so much energy, and was so entrepreneurial,” Tabarrok says. “It’s been kind of exciting to see him become one of Elon’s most trusted right-hand men.”
(Updates with Musk’s wealth in 10th paragraph. An earlier version of this story corrected the spelling of Tabarrok’s name.)
