**Elon Musk’s Fortune Drops $13.6 Billion as Tesla Warns of Price Cuts**
Tesla, the electric vehicle company founded by Elon Musk, issued a warning that it may need to further reduce the prices of its vehicles. This announcement led to a significant decline in Musk’s net worth, which dropped by $13.6 billion in a single day.
**Musk’s Wealth Gap Narrows with Bernard Arnault**
As a result of the decline, Elon Musk’s wealth now stands at $241 billion. This decrease has narrowed the gap between Musk, the second richest person in the world, and Bernard Arnault, the chairman of luxury goods company LVMH. Despite the decline, Musk still maintains a substantial lead over Arnault, with a $40 billion difference in wealth.
**Tesla Shares Tumble as Price Cuts Impact Profitability**
Following the announcement of potential price cuts, the share price of Tesla plummeted by 7% to $271.02. This decline was a consequence of the negative impact on the company’s profitability, which has already been shrinking. Automotive gross margin, in particular, reached its lowest point in the past four years during the second quarter. Musk emphasized that if interest rates continue to rise, Tesla will be compelled to further reduce its prices.
**Musk’s Wealth Primarily Derived from Tesla Stake**
Elon Musk’s wealth largely stems from his stake in Tesla. Additionally, his holdings in Space Exploration Technologies (SpaceX) and Twitter also contribute significantly to his net worth. This year alone, Musk’s wealth has increased by $118 billion as shares of Tesla experienced a remarkable 136% climb.
**Arnault’s Wealth Growth**
On the other hand, Bernard Arnault has witnessed a $40.7 billion increase in his net worth this year, amounting to a total of $203 billion. This rise in wealth can be attributed to the performance of LVMH, a luxury goods company based in Paris, which has seen a 25% gain in its share price in 2023.
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