Tesla, helmed by Elon Musk, has witnessed a staggering 29% dip in stock value within a mere 10 weeks, reaching its lowest point since May. This tumultuous descent has resulted in a jaw-dropping $234 billion reduction in market capitalization, settling just above $550 billion.
Outshining Giants: More Than McDonald’s, Disney, or Nike
Business Insider reports that this plunge surpasses the market values of corporate behemoths like McDonald’s ($212 billion), Disney ($202 billion), and Cisco ($199 billion). The collateral damage extends to Netflix ($259 billion) and Coca-Cola ($257 billion), exceeding the valuations of American Express ($158 billion) and Nike ($148 billion). The fall is magnitudes beyond Starbucks ($104 billion), Chipotle ($71 billion), FedEx ($62 billion), and Palantir ($58 billion).
Musk’s Fortune Shrivels: $40 Billion Personal Wealth Erosion
Concurrently, Elon Musk’s personal fortune has taken a hit, dwindling by almost $40 billion in 2024, plunging below $190 billion. This has reshuffled the billionaire hierarchy, ousting Musk from Bloomberg’s top spot, now trailing behind Bernard Arnault and Jeff Bezos.
Tesla’s Rise and Fall: A 60% Drop from November 2021 Peak
Though Tesla shares soared nearly fivefold since the start of 2020, they now stand diminished by 60% from their November 2021 zenith when the automaker boasted a valuation of $1.2 trillion.
Hertz Unplugs: Concerns Over Electric Car Demand and Repair Costs
The market upheaval finds roots in ominous signals of waning demand for electric vehicles, especially notable from car rental giant Hertz. Hertz is divesting itself of 20,000 electric cars in the U.S., citing concerns about demand and higher repair costs for electric-powered vehicles, a move aimed at balancing the supply-demand equation for electric vehicles.
Hertz’s Electric Vehicle Pivot: A Drastic Shift in Plans
As per Engadget, Hertz’s cautious approach to electric vehicles has been evident. In 2021, the company procured 100,000 Tesla vehicles, and subsequent plans to purchase up to 65,000 electric cars from Polestar were scaled back in October 2023. CEO Stephen Scherr cited electric vehicles costing “about twice as much in terms of damage repair costs as a conventional internal combustion engine vehicle.”
Tesla Still Towers: Value Surpasses GM and Ford Combined
Despite Tesla’s market turbulence, its current valuation remains over 10 times that of industry stalwarts General Motors ($46 billion) and Ford ($49 billion), underscoring the enduring impact of Musk’s brainchild in the automotive landscape. Hertz’s retreat from electric vehicle plans adds a new layer to the evolving narrative of electric mobility in the face of economic realities.
