Elon Musk’s fortunes suffered a serious dent this year, as the shares of his electric vehicle venture Tesla Inc. TSLA languish.
What Happened: Musk’s net worth stood at $170 billion, based on Tesla stock’s closing price on Monday, the proprietary billionaires’ index compiled by Bloomberg showed. Year-to-date, the world’s richest man has lost about $101 billion of wealth, the first time he has lost over $100 billion in a year, Bloomberg said.
Musk’s fortunes are closely tied to Tesla stock via the stake he holds in the electric vehicle venture. He also owns a 44% stake in SpaceX, which is still a closely-held company.
Among the other billionaires who have bled money heavily are Meta Platforms Inc.’s META Mark Zuckerberg, Binance’s Changpeng Zhao and Amazon Inc. AMZN founder Jeff Bezos.
Why It’s Important: Tesla shares have been on a downhill since the start of the year. After closing at a two-year low on Friday, the stock fell 6.84% on Monday before settling at a fresh two-year low of $167.87, according to Benzinga Pro data.
Tesla’s woes are manifold. The company is facing a slowdown in China — one of its key markets from the perspective of both demand and supply. Reports suggest the company is planning to follow up on its two price cuts over the past month with another before the end of the year as demand dries up.
Competitive pressure is also weighing down on the EV giant, which once had all the market for itself. The lucrative market for EVs has led to the mushrooming of several upstarts and pivoting of traditional automakers into EV manufacturing.
To make matters worse, Musk himself has introduced a risk proposition by deciding to buy Twitter. Musk is believed to have overpaid for the platform which has forced him to offload some of his Tesla stake to meet the shortfall in the purchase price. Musk’s time spent on setting right Twitter and ironing out transition-related issues hasn’t been looked upon positively by retail investors.
Tesla is down about 29% in the year-to-date period and has pulled back a whopping 60% from its all-time high of $414.50 reached on Nov. 4, 2021. When Tesla's stock price peaked, Musk’s net worth was at around $340 billion.
Price Action: Tesla closed Monday's session down 6.84% at $167.87, according to Benzinga Pro data.
Photo: Courtesy of Wikimedia Commons
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