Elon Musk, the CEO of Tesla, is currently the second richest person in the world just after two days of being crowned the world’s richest person.
According to the Bloomberg Billionaires Index, he dropped to No. 2 after his net worth decreased by nearly $2 billion on Thursday to $184 billion. After Bernard Arnault, the CEO of LVMH, who has a fortune worth $186 billion.
Just two days ago, Musk ousted Arnault from the top spot, but now, the roles have been reversed. The Frenchman removed Musk from his position in December after Tesla’s stock price dropped by 65% in 2022 as a result of a number of factors, including a weak economy, a slowdown in Chinese demand, Musk’s messy Twitter acquisition which soured investor sentiment, and a generalized tech downturn.
Musk’s decline from first place cames after a decline in Tesla stock. On Wednesday, shares closed 1.4% down at $202.77. During Tesla’s Investor Day in Austin, Texas, on Wednesday, they continued their slide in after-hours trading and closed 5.7% lower. A decline in stock prices would hurt Musk’s net worth because, according to Bloomberg, his 13% investment in Tesla accounts for the majority of his wealth.
The absence of a cost-effective electric vehicle from Tesla at the event on Wednesday may have negatively impacted investor sentiment. Before the presentation, there were market whispers that Musk may reveal a $25,000 automobile.
According to CEO of asset management company AXS Investments, Greg Bassuk,”It’s no surprise that Tesla stock fell over 5% in the hours following Tesla’s Investor Day, as it fell short for investors regarding details on any new Tesla products or services.” This was stated in a note on Wednesday that was made public.
Investors were disappointed, according to Bassuk, because they were expecting to learn more specifics about Tesla’s strategies for remaining competitive in the increasingly crowded and price-sensitive EV industry.
Notwithstanding the setback on Wednesday, Tesla stock has still increased by 65% so far this year due to increasing demand brought on by drastic price drops and favorable tax credit reforms in the US for electric vehicles.