New York CNN —
Elon Musk’s wealth destruction has become historic.
The CEO of Tesla (TSLA), SpaceX and Twitter is worth $137 billion according to the Bloomberg Billionaires Index, good enough for second place on the list of the world’s richest behind LVMH (LVMHF) chairman Bernard Arnault. But at its peak in November 2021, Musk’s net worth was $340 billion.
This makes Musk the first person to lose $200 billion in wealth, Bloomberg reported last week.
The bulk of Musk’s wealth is tied up in Tesla (TSLA), whose shares plummeted 65% in 2022. Demand for Tesla (TSLA) weakened as EV competition from incumbent automakers intensified over the past year. The company missed its growth targets and reduced production in China.
Evidence of car buyers’ waning interest in Teslas emerged last month after the company announced a rare sale to clear inventory. Tesla offered two rebates for buyers who take delivery of a vehicle before the end of the year, first a $3,750 rebate and then the $7,500 rebate with two weeks left in 2022.
Investors were unsettled by the rebates, sending the stock down 37% in December.
Critics have long questioned whether Tesla was ever worth the trillion-dollar valuation it was in early 2022. In its heyday, Tesla was worth more than the world’s 12 largest automakers combined, despite having a fraction of their sales. Tesla ended the year valued at $386 billion — still a lot bigger than its automaker rivals, but far smaller than the tech titans — Apple (AAPL), Microsoft (MSFT), Google (GOOGL), and Amazon ( AMZN) – which it was compared to a year ago.
Musk’s $44 billion purchase of Twitter hasn’t helped Tesla’s stock or Musk’s personal fortune. Musk, Tesla’s largest shareholder, has sold $23 billion worth of Tesla stock since his interest in Twitter became known in April.
His constant tweeting and increasingly erratic behavior, especially after taking over as CEO at Twitter, has angered Tesla investors, who want Musk to pay more attention to his significantly larger and more valuable company. Musk has defended himself against critics, saying he hasn’t missed a major Tesla meeting since taking charge of Twitter.
Tesla stock could rebound and Musk could become the world’s richest person again. But Musk’s reputation as a genius took serious damage in 2022 — almost as much damage as his personal wealth.