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New Delhi: Elon Musk’s net worth took a massive $22.2 billion hit on Tuesday, marking his fourth-largest single-day loss ever. The decline was driven by Tesla Inc.’s sharp stock drop, concerns over potential U.S. tariff impositions, and Musk’s involvement in federal cost-cutting measures.
Tesla, Musk’s biggest wealth contributor, saw sales in Europe nearly halve in January, leading to an 8.4% decline in its share price. This caused Tesla’s market capitalization to drop below $1 trillion for the first time since November 7, Bloomberg reported.
Why Did Musk’s Net Worth Plummet?
Tesla’s Sales Decline in Europe: January sales figures showed a nearly 50% drop, raising investor concerns.
U.S. Tariff Worries: President Donald Trump’s renewed commitment to impose tariffs on Mexico, Canada, and other trading partners triggered a broad market selloff.
Musk’s Political Involvement: Bloomberg linked Tesla’s decline to Musk’s deepening involvement in domestic political matters.
Rising Inflation & Declining Consumer Confidence:
- Inflation forecasts hit a two-year high.
- U.S. consumer confidence fell at the fastest rate since August 2021.
Musk’s Cost-Cutting Efforts and Employee Backlash
Musk has been leading cost-cutting efforts through the Department of Government Efficiency (DOGE), which has reportedly saved $65 billion—just under 1% of the 2024 U.S. federal budget.
However, these measures have:
Sparked more than a dozen lawsuits.
Created job insecurity among federal employees.
Led to mass resignations—on Tuesday, 21 DOGE employees quit, citing their unwillingness to "dismantle critical public services."
Where Does Musk’s Net Worth Stand Now?
Current Net Worth: $364 billion (Forbes)
December 17 Peak: $486.4 billion (record high)
Despite the $22.2 billion drop, Musk remains the world’s richest person, still $100 billion wealthier than he was before Trump’s U.S. presidential win. His record-breaking net worth surge last year was fueled by:
A rapid rally in Tesla’s stock.
Unprecedented funding rounds for his private ventures.
What’s Next for Musk?
With Tesla struggling, market fears rising, and Musk’s political involvement growing, investors will closely watch:
How Tesla rebounds from its recent sales dip.
The impact of potential U.S. tariffs on global markets.
Whether Musk’s cost-cutting strategies face further legal or political hurdles.
