SAGA | How did Elon Musk become the richest man in the world?

At the beginning of 2021, the CEO of Tesla and the rocket company SpaceX had an estimated fortune of approximately $ 155 billion. Now, almost a year later, his fortune has reached astronomical heights. On Dec. 17, his fortune reached $ 245.1 billion, a gain of $ 90 billion since Dec. January 2021.

Within two years, Elon Musk’s fortune jumped 200 billion dollars. By 2020, he will have earned more than $ 110 billion, setting a record for the largest single earner of any billionaire listed by Forbes.

The main reason: Tesla’s stock price, criticized by some as too high, continues to climb. Shares rose 32% year-to-date through Dec. 17. In early November, Musk surpassed the $ 300 billion mark for the first time, making him the richest man on the planet. Since then, the stock has fallen nearly 24% from its Nov. 4 high.

“It’s been a tough year for Tesla, with competition from all walks of life, a shortage of chips and stock coming off a historic year,” said Dan Ives, managing director and principal equity analyst at Wedbush . “Despite everything, Tesla was able to pull it off with flying colors.»

The year was also historic for SpaceX. This fall, the aerospace company launched the world’s first civilian personnel into orbit; shares of the private company also traded in the secondary market worth more than $ 100 billion, down from $ 74 billion in February. (Musk’s stake in SpaceX is estimated at $ 32 million.) And then there’s everything else, from the sale of six mansions in California to the alleged breakup with his popstar partner Grimes, to trolling the markets. with weird tweets.

Here are the events that marked Elon Musk in 2021:

Regulatory issues in China

Tensions between Musk and Chinese regulators weighed on Tesla shares in the first half of the year, Ives said. China, where Tesla has a factory, is a profitable market for the company, accounting for nearly a quarter of total revenue for the first nine months of 2021, according to the company’s third-quarter earnings report. However, while Beijing has cracked down on domestic tech players this year, it has implemented strict regulations on automotive data collection and the ability to move that data out of the country. It threatened to hinder Tesla’s R&D efforts, as the automaker collects a lot of user data from cameras and sensors installed in its vehicles to repair its self-driving systems. Tesla is also under investigation after a protester at the Shanghai auto show in April rode a Model3 and criticized a problem with the vehicles ’braking.

A change came in September, when Musk spoke at the annual Global Internet Conference in China, reassuring government leaders of Tesla’s commitment to grow in the country. “We are working with regulators to find the best solution for data security,” Musk said at the conference, pointing to a new data center Tesla has set up in China to store “personally identifiable information “locally. without moving them across the border.

Lack of fleas

Semiconductors are an integral part of new cars, enabling things like infotainment systems, engine management, power braking and steering. Supply chain issues led to a shortage of these chips in 2021, which hit automakers like General Motors and Ford, but, according to Ives, Tesla escaped unscathed. In fact, Tesla has been making its chips for years, using a new material technology called silicon carbide that reduces reliance on pure silicon. As a result, the lack of Tesla vehicle manufacturing goals did not hinder, although the company’s Fremont, California plant stopped production for two days in February because of Musk’s vague statement. identified as “component deficiencies.”

Tesla Exceeds $ 1 Trillion Appreciation

Tesla’s stock received a boost in October, when car rental giant Hertz announced it would buy 100,000 Tesla vehicles to add to its rental fleet-it has reportedly agreed to spend of approximately $ 4.2 billion to do so. Following the announcement, Tesla’s market capitalization crossed the $ 1 trillion mark for the first time, and Elon Musk’s net worth exceeded $ 300 billion, making him the richest man of all time.

On Dec. 17, his fortune was estimated at $ 245.1 billion and he remains the richest man in the world, ahead of Amazon founder Jeff Bezos, French fashion magnate Bernard Arnault and Microsoft founder Bill Gates.

SpaceX is making history

As Musk’s fortunes rise to new heights, so do his intergalactic projects. In mid-September, SpaceX launched the world’s first all-civilian crew into orbit, opening the door to the burgeoning space tourism industry. The crew of four, including fintech billionaire Jared Isaacson, spent three days touring the world. It was an important milestone in the career in space between billionaire Musk, Jeff Bezos and British billionaire Richard Branson. Although Musk has not personally flown into space this year, his rivals have. Jeff Bezos was aboard a BlueOrigin rocket launched into orbit in July, about a week after Richard Branson took part in a similar trip organized by his space tourism company Virgin Galactic. (Musk has also booked a spot on the future Virgin Galactic space excursion, but it’s not yet clear when exactly he will leave).

Mass stock sale

In Nov. 6, Musk sent shockwaves into the business world when he launched a Twitter poll in which he casually asked his followers if he should sell 10% of his shares in Tesla. Musk previously only sold shares of Tesla on two occasions, in 2010 and 2016. Two days later, Musk began selling shares and exercising stock options due to expire in August 2022. In December 13, he has already sold nearly $ 13 billion worth of Tesla stock; Forbes estimates that he could pay $ 8.3 billion in taxes as a result of these sales, which could make him the largest taxpayer in the United States (Musk said on Twitter that he would “pay more ‘taxes than to any American in history this year ‘).

“It’s also, of course, a PR move,” Ives said of Musk’s Twitter poll.

According to Forbes calculations, Musk accumulated approximately $ 4.4 billion in cash (after taxes) from stock sales as of Dec. 13.

Move to Texas

bet of musk on Lone Star State in 2021. By June, he had sold six of his seven mansions in California, and his last home was on the market. His main residence now? An approximately 37 square meter, studio-sized “collapsible, prefabricated” housing set up in Boca Chica, Texas, where SpaceX makes its Starship rockets.

After some controversy with California lawmakers about Covid-19 safety rules at Tesla’s Fremont plant from 2020, the billionaire announced plans to move Tesla’s headquarters from Palo Alto to Austin, Texas, during of the annual shareholder meeting in October 2021. Musk took a more diplomatic approach to the meeting, citing the high cost of housing in California and long travel as the main reasons for the move. The move was completed in early December, but it’s not yet known how many Tesla employees will move to Austin or how many new jobs could be created.

A break

Musk’s personal life has also had some twists and turns. In late September, she broke up with Grimes, the grunge musician she had dated for nearly three years, just weeks after attending the Met Gala together. The couple gave birth to a son named X Æ A-Xii Musk in May 2020.

New Year’s resolution?

The holiday season is usually synonymous with philanthropy for billionaires, but giving doesn’t seem to be a priority for the world’s richest people this year. Nearly ten years ago, Musk signed the Giving Pledge, a promise to donate at least half of his fortune to charitable causes. Forbes estimates that to date, Musk has donated less than 1% of his wealth for charities.

According to Mr. Ives, the year 2022 will be marked by greater use of electric vehicles and increased competition. So Tesla will focus on increasing production capacity at its main factories in Berlin and Austin, Texas. Tesla could increase its total production to two million vehicles a year, from about a million at present, Mr Ives said. In comparison, Toyota, GM and Ford sell more than four million vehicles a year, although only a fraction are electric vehicles.

“We’re really seeing a arms race for electric vehicles,” Ives said. “Tesla is many years ahead from a battery technology standpoint … But there is a target behind Tesla.»

This should make 2022 another exciting year for Elon Musk. On December 9, he tweeted that he was “considering quitting his job and becoming a full-time influencer.” Musk’s salary package for Tesla includes an additional 36 million options, valued at nearly $ 32 billion, if he can satisfy the company’s investors and raise the stock price amid forces he can’t control.

Article translated from Forbes US-Author: Eliza Haverstock

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