Tesla Founder and Chief Executive Officer, Elon Musk, is no longer the world’s richest man, after losing more than $7 billion to market sell-offs over the course of fewer than 24 hours, bringing his net worth to $198 billion.
The loss was prompted by a market pullback on Tesla shares –which are among the most valuable in the world, as Chinese economic kerfuffles led to a drop of nearly 4 percent on Monday. The global markets started the week on an agitated note over fears that the debt troubles of a Chinese property developer, Evergrande, could lead to fallout for the Chinese and global economies, prompting a selloff in riskier assets. Worried investors dumped Chinese property stocks and sought refuge in safe-haven assets.
On Monday, shares in Evergrande, which has been struggling to secure funds to pay its many lenders, suppliers, and investors, closed down 10.2 percent at HK$2.28 on Monday, after earlier diving 19 percent to its lowest level since May 2010. Regulators warned that Evergrande’s $305 billion of liabilities could spark broader risks to China’s financial system if its debts are not stabilized.
Albeit the recent sell-offs, Tesla is still the most valued electric car maker. The electric automaker has been manufacturing its Model 3 and Model Y in China since early 2020, at a facility called Giga Shanghai. Since its launch in the Chinese electric vehicle market, Tesla has continued to be one of China’s leading electric-car manufacturers, and a number of plant facilities have transitioned into a sort of export center. Giga Berlin, Tesla’s new factory in Berlin, has just begun construction as the company shipped Model 3 and Model Y vehicles from China to Europe. The company also holds the record for being the largest employer in the automotive industry in California, selling sedans, sport utility vehicles, and trucks.
Several stocks were down on Monday, including electric vehicle stocks, which have performed well over the past few years, with the decline in stock value tantamount to a decline in the wealth of the owners. Elon Musk is now second to Amazon owner Jeff Bezos in the billionaire rankings.
Last year, Elon Musk set the record for one of the fastest streaks of wealth accumulation in history.