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Tesla’s Downhill Drive: Why ‘Big Short’ Investor Danny Moses Predicts a 70% Stock Plunge

Danny Moses, renowned for his prescient bets during the 2008 financial crisis as depicted in “The Big Short,” is sounding the alarm on Tesla. He contends that Tesla’s stock is on a trajectory for a dramatic 70% decline, potentially bottoming out at $50 per share from its current level of $171. This grim forecast hinges on what he perceives as unsustainable reliance on future robotaxi and AI initiatives to mask deeper business frailties.

In a recent interview with CNBC, Moses elaborated on his bearish stance, which was initially sparked by Elon Musk’s acquisition of X (formerly Twitter). He argued that this diversion diluted Musk’s focus on Tesla at a critical juncture. With Tesla already down 33% year-to-date, Moses critiques Musk’s leadership, particularly his strategic emphasis on robotaxis and AI as a diversion from Tesla’s “core business issues.”

Moses expressed skepticism about the timing of Musk’s push towards high-concept projects like AI and autonomous vehicles. He described these initiatives as distractions aimed at deflecting attention from operational challenges, including significant layoffs and organizational disarray. “For someone who cares so much about the human race, he is firing a lot of humans at this moment, and everything’s kind of falling apart in their core business,” Moses noted, underscoring a disconnect between Musk’s futuristic ambitions and the company’s current instability.

Further complicating Tesla’s outlook is an ongoing investigation by the Department of Justice into whether the company has overrepresented the capabilities of its self-driving technology to consumers and investors. Such scrutiny adds a layer of uncertainty to Tesla’s future, potentially undermining investor confidence if adverse findings emerge.

Despite his critical view of Tesla, Moses remains engaged in the broader automotive technology sector. He highlighted his investment in Wayve, an autonomous driving startup that has recently secured $1 billion in funding from high-profile backers including Nvidia and Bill Gates, indicating his belief in the sector’s potential, albeit through different players than Tesla.

Moses’s stance represents a stark counterpoint to the more optimistic views that have long buoyed Tesla’s market valuation. As the narrative around Tesla becomes increasingly contested, investors are left weighing whether Musk’s visionary projects will indeed pave the way for future growth or if they serve as a smokescreen for more fundamental performance issues.