Elon Musk has put two of his California homes on the market for a combined $39.5million just days after his bizarre Twitter rant caused Tesla shares to plunge more than 11 per cent.
On Friday, the Tesla founder announced that he felt the company’s stock price was ‘too high’, before revealing he was planning to sell off his physical possessions.
At the closing bell, Tesla was trading at $701.32 per share – down more than 10 per cent. The subsequent share drop erased around $13billion from Tesla’s market value and nearly $3billion from the value of Musk’s stake.
The tech entrepreneur, who according to Forbes is worth more than $38billion, also tweeted on Friday that he intends to sell ‘almost all physical possessions’.
‘Will own no house,’ Musk wrote. On Monday, it was revealed that the billionaire had listed two Bel Air properties on Zillow. The homes have been on Zillow for less than 24 hours.
The first home is Musk’s lower Bel Air estate that overlooks the Bel Air Country Club.
The residence, which was purchased by Musk in 2012 for $17million, has been listed for $30million on Zillow.
The 16,251sqft mansion features six bedrooms, 11 bathrooms, a two-story library, swimming pool, and a tennis court.
It also features a gym, pool, a wine cellar, fruit orchard and a five-car garage.
The second home has been listed for $9.5million and used to be owned by late Willy Wonka actor, Gene Wilder, who died in 2016.
It features five bedrooms, 4.5 bathrooms, an oval pool and a private guest cottage.
In November 2013, Musk purchased the three-quarter-acre Bel Air home for $6.75million. Musk has since turned the property into a private school.
In one of his Friday tweets, Musk said he would sell the home with certain conditions.
‘Just one stipulation on sale: I own Gene Wilder’s old house. It cannot be torn down or lose any its soul,’ Musk said.
The home is one of six that Musk bought within walking distance of each other. Musk also purchased a seventh home near Tesla headquarters in Northern California.
In total, he has spent more than $100million for seven properties since 2012, according to The Wall Street Journal.
Musk bought two homes in in 2015: a modest ranch house for $4.3million and $20million mansion.
A year later, Musk purchased a large, unfinished home for $24.25million. All three homes sit on the cul-de-sac of five homes.
On Friday, Musk assured his followers that the selling of his possessions was not financially motivated.
‘Don’t need the cash. Devoting myself to Mars and Earth. Possession just weigh you down,’ Musk tweeted.
Despite his Friday Twitter rant, Tesla shares are up 4.5 per cent as of Monday. When asked by The Wall Street Journal if he posted the tweets in jest, Musk replied: ‘No.’
It’s not the first time that Musk’s tweets have landed him in hot water with his investors.
The billionaire was fined $40million last year after he wrongly claimed in a 2018 tweet that he’d secured funding to take Tesla private.
The Securities and Exchange Commission (SEC) sued Musk that year after he tweeted on August 7 that he had ‘funding secured’ to take Tesla private at $420 per share.
The number ‘420’ has significance for pot-smokers. In cannabis culture, the date 4/20, or April 20th, is celebrated as a national holiday.
Musk’s tweet about leading Tesla to a $420 per share stock price was seen as a joke about marijuana.
The SEC, however, said the tweet, which sent Tesla’s share price up as much as 13.3 per cent, violated securities laws.
Musk’s privatization plan was at best in an early stage and financing was not in place.
As part of a settlement with the federal government, Musk agreed to have certain tweets pre-approved by lawyers, and monitored by a company committee.
However, on Friday, Musk appeared to have gone rogue in a series of incoherent tweets that included misquoted lyrics of The Star Spangled Banner.
Musk also tweeted: ‘Now give people back their FREEDOM.’
That tweet is likely a reference to Musk’s controversial comments slamming the coronavirus lockdown, which he called ‘fascist’ on Wednesday.
Musk then remarked on Twitter that his girlfriend, the musician Grimes, was mad at him.
In response to another Twitter user, Musk revealed that Grimes, who is pregnant, is due to give birth today. The baby will be Musk’s sixth child.
The South Africa native was first married to Canadian author Justine Musk, with whom he has five children.
Their firstborn died of sudden infant death syndrome at the age of 10 weeks.
Musk was married twice to British actress Talulah Riley. The couple also divorced twice.
Musk also had a brief, highly publicized relationship with Johnny Depp’s ex-wife, Amber Heard.
Musk on Friday also attempted to recite the Star Spangled Banner, tweeting: ‘And the rocket’s red glare, the bombs bursting in air…gave proof through the night that our flag was still there…Oh, say does that star-spangled banner yet wave…O’er the land of the free and the home of the brave?’
He then tweeted: ‘Rage, rage against the dying of the light of consciousness.’
In recent days, Musk has vented over the ongoing coronavirus lockdown.
Even though his company has reported healthy earnings, one of the biggest disruptions to Tesla has been the government-ordered shutdown of its factory in Fremont, California, which began on March 24.
Alameda County, where the factory is based, on Wednesday extended stay-at-home orders until May 31 and vehicle manufacturing is not considered an essential business that is exempt.
On a conference call on Wednesday, Musk said he did not know when they could resume production.
‘I think the people are going to be very angry about this and are very angry,’ Musk said as he went off track in the call about earnings.
‘It’s like somebody should be, if somebody wants to stay in the house that’s great, they should be allowed to stay in the house and they should not be compelled to leave.
‘To say that they cannot leave their house and they will be arrested if they do, this is fascist. This is not democratic, this is not freedom. Give people back their goddamn freedom!’
The strictest stay-at-home orders recommend that people only leave their homes for essential trips such as visiting the grocery store or pharmacy.
Tesla shut down the California factory just as it was ramping up production of its new electric crossover utility vehicle Model Y, which it expects to generate record demand and higher profit margins.
Tesla on Wednesday said the Model Y was already contributing profits, marking the first time in the company’s history that a new vehicle is profitable in its first quarter.
Last month, Tesla said production and deliveries of its Model Y sports utility vehicle were significantly ahead of schedule, as it delivered the highest number of vehicles in any first quarter to date, despite the outbreak.
The electric car and solar panel company said it made $16million from January through March, its third-straight profitable quarter.
Excluding items, Tesla posted a profit of $1.24 per share. Analysts had expected a loss of 36 cents per share. Tesla shares are also up for the year after recovering from a sharp slump in March.
But Musk called the state stay-at-home order a ‘serious risk’ to the business.
‘So the expansion of the shelter in place or as frankly I would call it, forcibly imprisoning people in their homes, against all their constitutional rights, is my opinion, and breaking people’s freedoms in ways that are horrible and wrong, and not why people came to America or built this country, excuse me,’ Musk added later.
‘It’s an outrage. It will cause loss, great, great harm, but not just to Tesla, but any company. And while Tesla will weather the storm there are many small companies that will not.’
Tesla produces a fraction of the cars of its rivals but has a much larger stock market value on expectations of tremendous growth.
Musk said that while other carmakers were cutting back, Telsa was ramping up investment.
He said Tesla might announce the location of a new US factory in one to three months.
But Tesla on Wednesday said it expected production at its vehicle factories in Fremont, California and in Shanghai, China to ramp gradually through the second quarter.
The company said operations at its Shanghai plant were progressing better than expected, with production rates of its Model 3 sedan expected to hit 4,000 units per week, or 200,000 per year, by mid-2020.
It delivered 88,400 vehicles during the first three months of the year, a 40 per cent increase from a year ago. That was aided by production at its new factory in Shanghai.
It said gross margins at its Shanghai factory were approaching those of Model 3 production in the United States.
