Elon Musk loses $16.1 billion as Tesla shares tumble on weak Q3 performance

Elon Musk's wealth took a significant hit on Thursday, plummeting by $16.1 billion due to Tesla's underwhelming third-quarter earnings report, which cast a shadow on the company's stock performance.

Musk, the richest individual on the planet with a fortune currently totalling $209.6 billion, possesses a 13% stake in Tesla, and a substantial portion of his wealth is derived from his association with the automaker. Following a disappointing quarter, Tesla's stock price declined by 9.3%, failing to meet both earnings and sales projections.

During a conference call that followed the earnings announcement on Wednesday, Musk repeatedly emphasised the negative impact of high interest rates on consumer confidence. The electric vehicle giant reported its first quarterly sales decline this year, delivering a total of 435,059 vehicles, while profit margins sank to their lowest point in over four years due to persistent price reductions for Tesla's vehicles.

Nonetheless, Musk's wealth has seen an increase of over $71 billion in 2023, in tandem with a resurgence in Tesla's stock value, even as the company's financial fundamentals weaken. After briefly losing his title as the world's wealthiest individual to Bernard Arnault of LVMH, Musk has once again reclaimed the top spot by a considerable margin.

Despite its challenges, Tesla remains committed to placing 1.8 million customers in new vehicles by year-end. It retains its status as the most valuable automaker globally and has announced plans to finally deliver its highly anticipated Cybertrucks in November, approximately two years later than initially scheduled.

Tesla has also raised the price of its Model X Plaid all-wheel drive in the United States from $89,990 to $94,990, according to information on the electric vehicle manufacturer's website. This decision follows a statement by CEO Elon Musk, who noted that Tesla had successfully sustained demand through a series of price reductions but expressed concerns about the potential impact of rising interest rates, which could render cars less affordable.

Musk explained that the increase in financing costs has resulted in the price of the popular Model Y SUV remaining "virtually unchanged" for consumers, despite previous price reductions. In a related move earlier this month, Tesla had reduced the prices of its Model 3 and Model Y vehicles in the US.

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