By Shane Neagle
(Translation of the English article written on December 20, 2022)
electric car manufacturer tesla(NASDAQ:)The stock price of fell nearly 15% in November and continues to underperform the market in December. Monthly declines are expected for five straight months and are down more than 50% from their August peak.
As Tesla shares tumble, Elon Musk conducts a Twitter poll
On Monday (19), Elon Musk asked his Twitter followers if he should step down as CEO of Twitter and promised to respect the results. More than 57% of respondents were in favor of Musk stepping down as CEO, while 43% wanted him to stay on as CEO.
However, as of this writing, Elon Musk has not commented on whether he will step down as Twitter CEO following the poll results. On Tuesday (20), CNBC reported that Musk was “actively seeking” a Twitter CEO to replace him.
The poll was conducted at a time of chaos with rapidly changing policies and decisions in the two months since Musk became CEO of Twitter.
In fact, it wouldn’t be too much of an exaggeration to say that Tesla investors were probably “yes” to Elon Musk’s resignation as Twitter CEO. Tesla investors were growing increasingly annoyed by the way Elon Musk had been sidetracked by his takeover of social media platform Twitter. Tesla’s stock price, which can be said to be the source of Musk’s wealth, has fallen nearly 60% since April, when Musk announced his plans to acquire Twitter.
Tesla’s market cap was $1.1 trillion as of April 1, the last trading day before Musk revealed he bought a stake in Twitter. But since then, its market capitalization has declined by 58%, opening up opportunities for competitors to increase their market share.
Wedbush analyst Dan Ives said, “The Twitter takeover has hurt Musk’s reputation, created a ledge for Tesla stock, and since the beginning of Twitter’s history the pain has continued brutally,” he said.
Ives thinks Musk’s resignation as Twitter CEO will support Tesla’s share price and show that Musk has “finally understood the growing discontent surrounding the Twitter nightmare.”
Too much attention on Twitter
Since the $44 billion acquisition of Twitter two months ago, Elon Musk has implemented several changes to Twitter’s policies, some of which have raised concerns among advertisers and users.
Musk cut half of Twitter’s workforce, cut content reviewers and dissolved the Trust and Safety Committee. Musk also stopped enforcing coronavirus-related disinformation rules and insisted that Anthony Fauci, the White House chief medical adviser and infectious disease expert, be punished. Just before the survey on Twitter, users on Facebook(NASDAQ:)Instagram, Mastodon, and other social media platforms, including Twitter, have announced a significant policy change.
However, a tweet announcing the policy change, posted on Twitter’s official “Support” account and Twitter blog, was deleted on Monday without explanation. The move has met with massive opposition and criticism, including from Musk supporters. Ultimately, Musk said he would ask users’ opinions first before changing the policy.
All of this news has led to a glut for Tesla stock. Many long-term Tesla investors are increasingly fed up with Musk’s outrageous behavior.
“Previously, people who bought a Tesla proudly drove it in front of their friends and showed their Tesla on the road,” said Gary Black, managing partner of Future Fund LLC and owner of $50 million in Tesla stock. Tesla’s quality is taking a hit due to the Twitter controversy.
Also, another Tesla stock sell-off was triggered last week after Musk sold 22 million Tesla shares, valued at $3.6 billion, to fund his takeover of Twitter. In 2022, Musk sold a total of 94,202,321 shares for an average price of $243.46, grossing a total of $22.93 billion (before tax). After April 28, Musk announced that “there is no longer any plan to sell Tesla stock,” but he sold Tesla stock again within months.
Ben Silverman, head of research at VerityData, said: “The sale of Tesla shares in November 2021 was brilliantly timed, so Tesla shareholders need to pay attention to Musk’s actions, not his words.”
Despite Musk’s April statement, he has sold Tesla shares on several occasions since the Twitter acquisition. Musk explained to his employees that he sold shares to “save” the company.
All this in a context of weakening demand for electric vehicles
Earlier this month, Tesla cut the price of electric vehicles in the US. It offered a $3,750 discount on the Model 3 and Model Y sold in December. The price cuts refer to Tesla’s reports of weakening demand for its new electric vehicles in the US market.
Now, many customers are waiting for bigger tax credits under the Inflation Reduction Act (IRA). The US government will provide tax credits of up to $7,500 for electric vehicles with batteries that use at least a certain percentage of US-made parts.
Tesla’s stock price has certainly risen massively since it went public in June 2010, but it’s now experiencing weakening demand in its largest markets, including the US, China, the UK, and Australia. In regions where demand has weakened, Tesla’s inventory is piling up.
summary
Tesla shares came under heavy selling pressure in December as the controversy over Elon Musk’s tweets continued. Tesla investors think Musk should hand over the Twitter CEO job to someone else, as promised. Only then will Musk be able to refocus on Tesla at a time when Tesla is facing weakening demand in a challenging macroeconomic environment.
***
writerShane NeagleIt is ‘The talknist(The Tokenist)’editor-in-chief of(EIC)and. For a weekly analysis of key finance and tech trends, check out The Talknist’s free newsletter ‘Finance in five minutes(Finance in five minutes)’To look.
Investing.com & https://kr.investing.com/Unauthorized reproduction and redistribution prohibited
