A combination of market changes, the pandemic, and a drastic purchase has caused Elon Musk to lose around $180 billion to $200 billion, according to Guinness World Records. It is another record set by Musk, although it was not to his advantage. But is Elon Musk poor now? Not in the slightest bit. Even though the billionaire suffered these enormous losses, he is still the second richest person in the world. Bernard Arnault, CEO of the luxury brand Louis Vuitton Mot Hennessy (LVMH), took first place. Arnault’s net worth is estimated at $190 billion, a few billions more than Musk’s estimated net worth of $130 billion.
So what happened to Elon Musk? Bloomberg says Tesla’s stock market has plummeted by 65% in the last year, the lowest price yet for the tech company. Experts have analyzed this price drop to be due to some competition emerging in the market. Tesla was the first to launch and popularize electric cars. The company was so trendy that it had a $1 trillion value in 2020-2021. But like all markets, being the first doesn’t guarantee lasting success. Now that some companies have developed their electric cars, Tesla’s stock has gone down.
Another reason for Tesla’s decline in the stock market is the issue with its manufacturing. The COVID-19 pandemic was never completely erased, and outbreaks in Shanghai, where Tesla manufactures their cars, happened in 2022.
Aside from Tesla’s poor performance in the stock market, Elon Musk’s losses have been caused by another, more controversial reason—his purchase of the social media staple Twitter. For a whopping $44 billion, Musk now owns Twitter and has made drastic changes to the company, including setting up new policies and letting go of the staff that didn’t agree to his changes. His buyout was controversial even before the financial details were revealed. But the fact is, Twitter has been losing money, and Musk’s purchase of it in the name of “free speech” hasn’t filled its coffers.
Musk has been so passionate about buying out Twitter that he even sold his stocks at Tesla to fund the purchase. It hasn’t worked for him, so far. His new policies on the social media platform aren’t helping his case either. He was criticized for laying off the staff and butting heads with advertisers. To bring back some revenue, Twitter has announced that it will welcome political advertising, which has been banned since 2019.
According to the Guinness Book of World Records, the man who lost his place to Elon Musk only lost about $58.6 billion in the 2000s. Now, Musk holds the record at around $180 billion. It doesn’t erase Musk from the Forbes list, though he is still richer than all the people in the world except for one.
What happened to Musk shows how fickle business and the stock market can be. There are many factors to consider and many vital decisions to be thought of painstakingly. Many critics have pointed out Musk’s purchase of Twitter as an unwise move, especially because of how much it cost him. Only time will tell how Musk will recover from this downfall.