Elon Musk, CEO of five businesses, announced on Thursday, Dec. 22, that he will stop selling Tesla stock for around two years, reported first by Reuters.
Musk predicted that in 2023 there will be a severe recession and less demand for expensive items when speaking in a Twitter Spaces audio chat.
(Photo : Michael Gonzalez/Getty Images)
BOCA CHICA BEACH, TX - AUGUST 25: SpaceX founder Elon Musk walks on stage during a T-Mobile and SpaceX joint event on August 25, 2022 in Boca Chica Beach, Texas
Tesla Stocks' Sharp Decline
The billionaire's remarks followed a sharp decline in Tesla stock on Thursday due to concerns about waning interest in electric vehicles and Musk's diversion with Twitter and stock sales.
Musk has repeatedly pledged to refrain from selling Tesla stock before actually doing it. He revealed another $3.6 billion in stock sales this week, bringing his total since late last year to close to $40 billion.
The EV giant started offering $7,500 discounts to American consumers on Thursday, which increased investor concerns about waning demand as the economy slowed. Tesla's stock fell 9% on the same day as well.
Tesla has almost finished choosing the site for its next Gigafactory, according to Musk. The local newspaper Reforma reported on Monday that the company could soon reveal the construction of a Gigafactory in the state of Nuevo Leon, Mexico this Friday.
The news outlet said that the initial investment could be between $800 million and $1 billion.
When asked if he would hire a manager to oversee Twitter, such as venture investor David Sacks, so he could concentrate on Tesla, Musk sidestepped the topic by asserting that Twitter was a rather simple venture.
By this point in the year, Musk had lost $122.6 billion, exceeding the sum he had earned in 2021 when his fortune had reached one of the highest levels in recorded history, according to the Bloomberg Billionaires Index.
Musk and Twitter
Analysts believe that the high-interest debt Musk is currently repaying in conjunction with the acquisition of Twitter may be a factor in his decision to sell shares.
The social media company agreed to take on $13 billion in debt as part of the acquisition deal, $3 billion of those debts was unsecured and holds an interest rate of 11.75%.
Tesla shareholders are becoming more worried about Musk's preoccupation with Twitter, which he's trying to change after running into a few issues here and there.
He posted a poll on Twitter asking followers if they wanted him to continue serving as the CEO of the social media site. But according to the 17.5 million responders, 58% of them, wanted him to step down.
Musk said that if he could find someone willing to take over the bird app, he would resign from his post.
The second richest person in the world said at the company's Q3 earnings that Tesla may conduct a repurchase of stocks next year, most likely for a sum between $5 billion and $10 billion.
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