Despite the setback, SpaceX's "fail fast, learn fast" approach has helped it become the world's dominant launch services provider.
But Musk's status as one of President Donald Trump's closest advisers and his influence over federal regulators are raising concerns about potential conflicts of interest.
During Joe Biden's presidency, Musk frequently clashed with the FAA, accusing it of overregulating SpaceX over safety and environmental concerns.
Trump vowed in his inauguration speech in January "to plant the Stars and Stripes on the planet Mars."