What if you could short a public figure? No prizes for guessing who would top the list—Elon Musk. Love him or hate him, Musk’s empire—let’s call it “Musk Inc.”—seems built on a foundation as shaky as shifting sands.
The Tesla Rollercoaster 🎢
Take Tesla, for instance. Its stock has skyrocketed by nearly threefold since April, reaching $430 (£350). Impressive? Sure. But let’s pause for a reality check. Tesla’s growth story no longer matches the hype. Its price-to-earnings ratio sits at a jaw-dropping 110, even as global car sales for the company take a dip.
The competition isn’t just fierce—it’s ferocious. In China, rivals are beating Tesla on price and quality. Over in Germany, BMW and Mercedes are snatching up Tesla’s market share in the electric vehicle (EV) space. Yet, the company is valued at a staggering $1.37 trillion—more than four times the entire German auto industry combined. How long can such anomalies last?
A Political Tug-of-War 🎭
Here’s where it gets even more intriguing. Musk’s political maneuvering might make a game of chess look like child’s play. His rise in the Trump era was fueled by “techno-regulatory privilege” and what some would call crony capitalism. He even secured a prime spot at Trump’s inauguration.
But now, the tables are turning. Key Trump allies, like Steve Bannon, accuse Musk of trying to hijack the MAGA movement for personal gain. Bannon didn’t hold back, labeling Musk a “techno-feudalist” and claiming his ideas are half-baked. The clash between Musk and MAGA highlights deeper ideological divides that might be impossible to bridge.
Trouble on All Fronts 🌍
Musk isn’t just facing challenges at home. In China, Tesla’s operations are under threat as the government heavily invests in local EV giants like BYD. Meanwhile, Waymo and Chinese companies like WeDrive are racing ahead in autonomous vehicle technology.
Back in the U.S., Musk is losing ground with eco-conscious consumers who once championed Tesla. Even Europe’s largest pension fund, ABP, has dumped $600 million worth of Tesla shares. Why? The reasons range from Musk’s controversial pay package to broader dissatisfaction with the company’s direction.
What’s Next for Tesla? 🚗
Some, like Morgan Stanley’s Adam Jonas, remain bullish. Jonas envisions a future where Tesla dominates not just cars but also robotaxis, AI, and more. But the vision is still far off—Tesla doesn’t have Level 4 self-driving approval, and competitors are quickly closing the gap.
To make matters worse, Tesla’s U.S. tax credits are under threat, and geopolitical tensions could spell trouble for its operations in China. Musk’s tightrope walk between Beijing and Washington feels increasingly precarious.
The Icarus Moment 🌞
Elon Musk’s journey has been nothing short of extraordinary, but even he might not escape the laws of gravity. From geopolitical pitfalls to fierce competition and a shifting consumer base, the challenges are piling up.
For Musk, the question isn’t just about navigating these storms—it’s about whether he can keep flying high without his wings melting under the glare of the spotlight.
