Elon Musk said he isn’t planning to sell any more Tesla Inc. shares for two years, having offloaded almost $40 billion of stock this year, mostly to fund his purchase of Twitter Inc.
While the Tesla chief executive officer has made such proclamations before, only to later sell more stock, Musk’s comments on a Twitter Spaces audioconference late Thursday sent the carmaker up as much as 3.5% in postmarket trading. If those gains hold in regular trading Friday, the shares could break a five-day losing streak.
“I won’t sell stock until — I don’t know — probably two years from now, definitely not next year under any circumstances, and probably not the year thereafter,” Musk said in response to a question from longtime investor Ross Gerber, who challenged the CEO’s leadership of Tesla on Wednesday.
Difficult end to 2022
The electric vehicle maker has faced a difficult end to the year, not the “epic” one Musk had predicted. Tesla has cut prices and slashed production in China, and Musk has repeatedly criticized the Federal Reserve for raising interest rates. His sometimes conspiratorial and often politically charged tweeting also has turned off some consumers. To boost year-end sales in the US, the carmaker has turned to generous incentives.
‘Worse Case Scenario’
Tesla’s market value has fallen in recent trading below the half-trillion-dollar mark for the first time since November 2020. The slump accompanied his repeated unloading of shares — despite previous pledges otherwise.
Musk explained he raised that cash from stock sales to prepare for an unspecified “worse-case scenario,” adding it reflects his fears after living through two big recessions.
In a wide-ranging conversation on Twitter Spaces, the billionaire and Twitter CEO said he favours a buyback of Tesla shares once the company is more confident in the direction of the economy amid growing concerns about another recession. And Musk pushed back against criticism he’s spending too much time on Twitter and not enough on Tesla.
“There’s not a single important Tesla meeting that I’ve missed this entire time, so it’s not like I’m totally missing in action,” he said, adding that Tesla is many times more complex than the social media company.
Musk also said he aims to start production of a “meaningful volume” of lithium within two years at a refinery being built in Texas for use in Tesla’s EV batteries.