changing fortunes

Musk's attention shift from Tesla to Twitter is costing him the title of world's richest person

Billionaires’ rankings take the temperature of the public markets to which many fortunes are tied

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Pulled in all directions.
Pulled in all directions.
Photo: Dimitrios Kambouris (Getty Images)

Elon Musk has lost its spot as the world’s richest person, according to one ranking.

On Dec. 8, the Tesla, SpaceX, and Twitter chief started and ended the day in second place on Forbes’s real-time billionaires list. Bernard Arnault, chairman and chief executive officer of French luxury brand LVMH, and his family claimed the top spot—a position Musk had clung onto since September 2021 after overtaking Amazon founder Jeff Bezos.

Musk retains for now the top spot on Bloomberg’s billionaires index, but his estimated net worth on that list has already dropped by nearly $100 billion in the past year, closing the gap with the rest of the world’s ultra wealthy people. There’s only a $3 billion difference between Musk and Arnault’s fortunes according to Bloomberg, which uses a different methodology than Forbes and thus delivers slightly different results.

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Billionaires’ rankings are more than just a horse race, they take the temperature of the public markets to which many fortunes are tied. Musk’s slipping wealth is closely linked to the falling stock of his electric vehicle company, which began its decline in April, around the time the CEO decided to buy Twitter.

Ranked: Bernard Arnault dethrones Elon Musk as world’s richest

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How the Twitter deal affected Musk and Tesla’s fortunes, by the digits

$500 billion: Loss in Tesla’s market cap since the Twitter deal

$19 billion: Value of Tesla shares Musk has sold since April, likely to finance the Twitter deal

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$70 billion: Drop in Musk’s wealth since he first announced the Twitter purchase in April

$340 billion: Musk’s net worth at his peak in November 2021, when Tesla’s stock price hit a record of $414.50 a share

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14.3%: Musk’s remaining stake in Tesla

446 million: Tesla shares Musk owns

$86.95 billion: Value of Tesla shares Musk owns

Charted: Tesla’s share price has fallen nearly 50% in the past year

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Is Musk sacrificing Tesla for Twitter?

Musk financed the Twitter acquisition partly through bank loans and partly through cash derived from selling some of its Tesla shares. He told Twitter staff that his latest $4 billion sale of Tesla shares in early November was a bid to “save” the social network. And if dipping into the Tesla treasure chest wasn’t ruffling enough feathers, bankers are now mulling new margin loans tied to the Tesla stock to ease $3 billion of the $13 billion high-interest debt Musk took on to finance the $44 billion deal.

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Plus, he’s helped himself to Tesla’s manpower, bringing 50 employees over to work on Twitter (they were volunteers, according to Musk). While they account for a tiny fraction of the 100,000 people hired by Tesla and its subsidiaries, these moves make Twitter seem like the bigger priority.

“It’s almost like he’s abandoned us in favor of his new mission,” Tesla investor Trevor Goodman, who told Bloomberg he recently sold shares worth $30,000 after getting fed up with Musk’s Twitter drama. “When he announced he was going to purchase Twitter, I was totally against it because it’s a distraction from Tesla and everything he’s trying to accomplish there.”

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These concerns are only increasing as Musk is seemingly dedicating immense time and energy towards the Twitter overhaul. He said he’d be sleeping at the company’s San Francisco headquarters until the organization is “fixed.”

Musk claims he has “Tesla covered too,” but investors are still worried. A growing chorus of retail investors, who make up 42% of the shareholding, is demanding answers but struggling to get any. KoGuan Leo—the third-largest shareholder in the company—tweeted that the “Tesla board is missing in action (MIA)!” on Dec. 7. Another one, Brandon Smith, said investors are talking “into a black void. No responses. No action against FUD (Fear, uncertainty and doubt) or rumor. Nothing. No proactive action. Silence.”

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Meanwhile, Tesla’s laundry list of complaints is growing, including millions of recalls around the world, weakening demand in China, and chaos at its understaffed German gigafactory.

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