Elon Musk, the prolific entrepreneur behind Tesla, SpaceX, and X (formerly Twitter), is navigating a storm of challenges as 2024 unfolds. Notably, Tesla’s valuation has plummeted by $188 billion since the year began, marking a significant downturn for the electric vehicle giant and affecting Musk’s fortune considerably.
Tesla’s shares have fallen nearly 23% due to concerns over China’s economic instability and a potential slowdown in global electric vehicle (EV) sales. This decline has not only impacted Tesla’s market position but also cost it the title of the world’s largest EV maker to China’s BYD, despite BYD’s shares dropping by about 12% this year.
Analysts have mixed views on Tesla’s current valuation. Roth MKM’s Craig Irwin labeled the company as “egregiously overvalued,” setting a target price of $85 per share, a stark contrast to its closing price of just under $192. Despite this, Tesla’s shares are still up almost 900% over the past five years, reflecting its significant growth.
This tumultuous period has also raised questions about Musk’s leadership, with a Wall Street Journal report last month citing concerns from Tesla executives and board members about Musk’s alleged substance use, which Musk has denied.
Further complicating matters, a Delaware judge ruled against Musk’s $55 billion Tesla pay package, threatening his position as the world’s wealthiest individual. Musk’s response was to criticize Delaware as a business location and propose relocating Tesla’s incorporation to Texas, a move echoed by his other company, SpaceX.
X, the social media platform Musk acquired in 2022, has faced its own set of problems, with advertisers pulling back in response to Musk’s controversial comments and management style. Ad spending on X plummeted by 54% to $1.89 billion in 2023, challenging the platform’s financial stability and leaving it struggling to attract reputable advertisers.
SpaceX hasn’t been immune to challenges either, with controversies surrounding the use of its Starlink satellite internet terminals by Russian troops in Ukraine and delays in its moon-landing efforts. Despite these setbacks, SpaceX remains a key player in the commercial space industry, even as competitors like Houston’s Intuitive Machines achieve significant milestones.
As Musk contends with these multifaceted challenges, the impact on his companies and personal wealth continues to unfold. Despite the current volatility, Musk’s track record of innovation and disruption suggests that he may yet navigate these turbulent waters successfully. However, the immediate future holds uncertainty for Musk’s empire, as he works tirelessly to maintain momentum across his diverse ventures.