Tesla Stock Value and Elon's Power in DC

Elon Musk is an immensely wealthy individual who has effectively turned small investments into significant wealth. Excluding his $44 billion payment for control of Twitter (X), the total value of his personal investment stake in Tesla, SpaceX, xAI, Neuralink, and the Boring Company remains well below $1 billion, leading to an impressive current valuation of $344 billion.

Conglomerate Musk: What Matters?

However, several commentators have pointed out that despite this wealth, it is still a far more fragile house of cards than might be imagined. First, the most significant portion is tied up in Tesla and SpaceX. These two ownership stakes comprise more than 80% of Elon’s holdings.¹ SpaceX is privately held and likely illiquid², only usable as collateral rather than as cash.

Reliant on global markets and government contracts, SpaceX is highly exposed to geopolitical risks. Its valuation depends on international growth, but Musk’s political ties heighten scrutiny, as seen in Canada’s $68 million Starlink contract threat over U.S. tariffs. For now, SpaceX remains vital but vulnerable in Musk’s economic arsenal.³

Tesla’s 2025 Strategic and Operational Challenges

Tesla, valued at $1.22 trillion as of February 2025, is a different case.⁴ Elon’s $158 billion stake is potentially liquid but heavily pledged as collateral for the Twitter purchase. A margin call could be triggered if the stock no longer covers personal and corporate debt⁵ if its value can no longer secure it. His financial flexibility depends on Tesla’s valuation, much of which is speculative and hinges on continued growth and innovation.

But, Tesla’s reputation for innovation faces significant challenges in 2025. Failures in its product lineup and declining global sales contribute to a negative outlook. The Cybertruck, once marketed as a rugged, high-performance EV, has proven to be structurally fragile in real-world use⁶. Safety concerns have escalated further: Cybertruck fire-related fatalities now stand at 14.52 per 100,000 units—17 times higher than the historical rate of the Ford Pinto⁷. The goal of selling 500,000 annual units seems optimistic based on 2024 sales of only 40,000 units, forcing a scale-down in production.

Also, Tesla’s technological lead in battery innovation has fallen short. The 4680 battery, once an advantage, is now outdated compared to rivals. Auto sales continue to decline, plummeting in January 2025 in the EU by 45% year-over-year in an overall growing market⁸ . In California, Tesla’s most significant US market sales dropped by 11.6%, indicating weakening domestic demand⁹.

Investor dissatisfaction is rising. Following a lackluster robotaxi event and stalled FSD progress, Tesla lost over $100 billion in market value in early 2025. Key growth drivers like FSD and the Cybercab remain uncertain, limited by missing sensors (e.g., no LiDAR) and unclear regulation. With weakening fundamentals, a divisive CEO, and a high P/E ratio (161), experts warn of a likely further stock decline.¹⁰.

The Downside of Speculative Market Capitalization

At the end of 2024, Tesla’s market cap was $852.4 billion (it rose to $1.22 trillion by February 2025) on annual earnings of $12.6 billion, resulting in a price-to-earnings (P/E) ratio of 67.7. Toyota, an established automobile manufacturer with its electric vehicle line and a 2024 net income of approximately $29.0 billion, had a market capitalization of $243.6 billion. Toyota’s P/E ratio was only 8.4, a more realistic yet leading measure for legacy automobile companies.¹¹

If Tesla’s P/E ratio aligns with competitors—mainly if 2025 earnings fall 50% as expected due to lower sales and reputational issues—its market valuation could drop below $60 billion. Such a drop would be significant: Musk’s Tesla stake would fall to $7 billion, while combined personal and corporate debt would exceed $70 billion.¹²

Such an outcome could trigger creditor margin calls, jeopardizing Tesla’s control and eroding confidence in Musk’s ventures—many reportedly cross-collateralized with Tesla. Investors and board members would likely pressure Musk to prioritize corporate duties over his DOGE-related government activities.

Stoic Moments

“Wealth consists not in having great possessions, but in having few wants.”
[Epictetus, Discourses]

Surprisingly, a centibillionaire may have many wants that aren’t in his best interest—but could serve ours.

Need to Do Something?

To take personal and collective action, call your elected representatives daily, join a Telsa Takedown Protest, plan a garden for this summer, and get outside to maintain the energy and mindset needed to practice virtue.

Countdowns to the next Election(s)

Countdown to the national mid-term elections, when we can express our opinions about the performance of Congress: 597 Days

Countdown to the national presidential elections when we can express our opinions about the performance of Congress and the President: 1,332 Days

For contrast, consider the number of days since Ohio State last beat Michigan in football: 1,940 Days.

1. Baker, Brian, Elon Musk in 2025: What to know about the world’s richest person, Bankrate, 2.06.2025, https://www.bankrate.com/investing/elon-musk/

2. A stake in a privately held corporation can be valuable on paper but is illiquid in practice. Converting even a portion of a stake in a privately held entity into cash requires either a structured private sale (with company approval) or an initial public offering (IPO). Until then, these stakes mainly serve as a source of balance sheet leverage, not immediate liquidity.

3. Bryan, Robert, Tesla and SpaceX are ideal trade war hostages, Reuters, 2.05.2025, https://www.reuters.com/breakingviews/tesla-spacex-are-ideal-trade-war-hostages-2025-02-05/

4. Market capitalization (market cap) is the total value of a company’s outstanding shares of stock in the market. Market cap helps investors compare company sizes but does not reflect debt, assets, or intrinsic value.

5. A margin call forces a borrower to add collateral or repay part of a loan when the value of pledged assets—like stock—drops below a set threshold. If unmet, it triggers the sale of those assets, potentially driving the asset value down further.

6. WhistlinDiesel, “Cybertruck Frames are Snapping in Half”, YouTube Channel, 7.03.2024,

7. Enderle, Rob, FuelArc Has Rated The Tesla Cybertrucks As Over 15x More Likely To Kill Their Passengers Than The Infamous Ford Pinto, Torque News, 2.14.2025, https://www.torquenews.com/17995/fuelarc-has-rated-tesla-cybertrucks-over-15x-more-likely-kill-their-passengers-infamous-ford

8. Lewis-Stempel, Freda, Is Elon Musk turning people off Tesla? Two-thirds of car buyers would rather buy and EV from China, survey claims, Planet Money, 2.08,2025, https://www.thisismoney.co.uk/money/electriccars/article-14329005/Is-Elon-Musk-turning-people-Tesla-Two-thirds-car-buyers-buy-EV-China-survey-claims.html

9. Lockett, Will, Tesla Can, And Will, Fall Further., Medium, 3.15.2025, https://wlockett.medium.com/tesla-can-and-will-fall-further-903e9605f2b5

10. Hawkins, Andrew, Is Tesla Cooked?, The Verge, 3.11.2025, https://www.theverge.com/tesla/627894/tesla-stock-sales-protest-musk-trump-doge

11. Yahoo/Finance, 3.23.2025, https://ca.finance.yahoo.com/quote/TM/key-statistics/

12. Di Pizio, Anthony, Prediction: Tesla Stock Could Plunge by Another 50% (or More), The Motley Fool, 2.15.2025, https://www.fool.com/investing/2025/02/15/prediction-tesla-stock-could-plunge-another-50-mor/