Elon Musk drops out of exclusive $200bn club as Tesla shares tumble

World’s top 10 wealthiest people have lost a combined total of $290bn this year amid a sell-off in tech stocks, rising interest rates and concerns over a looming recession

Who is billionaire Elon Musk?

Who is billionaire Elon Musk?
Powered by automated translation

Elon Musk, the billionaire co-founder and chief executive of Tesla, dropped out of the exclusive $200 billion club on Tuesday after shares of the electric-vehicle maker tumbled by about 7 per cent to hit an 11-month low of $628.16 in New York trading, according to the Bloomberg Billionaires Index.

A combination of volatile stock markets, particularly the technology-heavy Nasdaq index, the Russia-Ukraine crisis, a hawkish US Federal Reserve and concerns over a looming global recession have taken a toll on Mr Musk’s net worth, which dropped 5.4 per cent — or $11.1bn — to $193bn.

It is the third time this year that Mr Musk’s personal fortune has dipped below the $200bn mark. However, it is the lowest it has been since August 23, 2021, when Mr Musk — who has put his $44bn bid for Twitter temporarily on hold — was worth $192bn, according to Bloomberg data.

So far this year, Mr Musk’s net worth has plummeted a total of 28.7 per cent — or $77.6bn.

Tesla shares fell amid concerns over production delays in China, which continues its strict Covid-19 lockdowns. Earlier this month, Tesla suspended most of its production at its Shanghai plant due to supply issues.

Investor concerns over the US Federal Reserve’s interest rate increases to rein in inflation, as well as the Russian-Ukraine war and the possibility of a recession have also contributed to the negative market sentiment.

However, technology stocks are bearing the brunt of market volatility, with the Nasdaq down about 26 per cent so this year.

“Overnight, the recession word weighed on stock markets once again,” said Jeffrey Halley, a senior market analyst for the Asia-Pacific region at Oanda.

“If there is one takeout from all of this for me, it is that rising inflation and borrowing rates are already crimping the demand side of the equation. The uncomfortable reality is that central banks are going to be forced to continue the tightening path, even as growth [picks up] around the world because inflation has proven sticky and not transitory.”

This is not the first time Mr Musk's net worth has taken a beating. On November 14, he lost a record $50bn after Tesla shares fell two days in a row.

“It is the biggest two-day decline in the history of the Bloomberg Billionaires Index and the highest one-day fall after [Amazon founder] Jeff Bezos’s $36bn decline after his divorce from MacKenzie Scott in 2019,” Bloomberg reported at the time.

Only two weeks earlier, on October 28, 2021, Mr Musk became the first person on the planet to be worth more than $300bn, with a personal fortune of $302bn, according to the Bloomberg Billionaires Index.

Meanwhile, the stock market volatility has hit the fortunes of the world’s top 10 wealthiest people, who have lost a combined $294bn from their net worth so far this year, Bloomberg data showed.

Mr Bezos, the world’s second-richest person, has lost $64.6bn this year and now has a net worth of $128bn, while Bernard Arnault, chairman of French luxury group LVMH and the world’s third-richest person, has shed a total of $53.1bn in 2022 and is worth $125bn.

To date, only three multibillionaires on Bloomberg’s top 10 rich list have increased their personal fortunes.

Renowned investor Warren Buffett, chairman of Berkshire Hathaway and the world’s fifth-richest person, has increased his personal fortune by $2.91bn to $112bn, thanks to his diversified portfolio that focuses on value stocks.

But it is India’s Gautam Adani, chairman of the Adani Group, who has recorded the biggest increase — $25.7bn — boosting his net worth to $102bn. He is the sixth-richest person in the world.

Until recently, all of the top 10 wealthiest billionaires in the world were members of the exclusive $100bn club.

However, a drop in the net worth of four billionaires has resulted in them losing their exclusive membership in the club, including Google co-founder Larry Page, the world’s seventh-richest person, with a net worth of $97bn.

Fellow Google co-founder Sergey Brin is also out of the club after shedding $30.5bn, which saw his net worth drop to $93bn. Former Microsoft chief executive Steve Ballmer has also lost $13.7bn, which pushed his personal fortune down to $91.9bn.


World's top 12 youngest billionaires under 30 - in pictures

Updated: May 25, 2022, 12:16 PM