In a long and extremely detailed article, The Wall Street Journal reported that Tesla (NASDAQ: TSLA) founder Elon Musk has used serious and often illegal drugs. Some of the people who work with him worry his behavior could harm decisions and that, in turn, this could hurt Tesla’s stock.
According to the Journal investigation, “In recent years, some executives and board members at his companies and others close to the billionaire have developed a persistent concern that there is another component driving his behavior: his use of drugs.” The paper further reports these drugs include LSD, cocaine, and ecstasy. Tesla has a policy that employees cannot use drugs, even when they are not at work.
If Musk takes powerful drugs, it is hard to argue that Tesla’s results are spectacular. Last year, Tesla’s stock rose over 100%. Deliveries of its vehicles for the year were 1.81 million, up 38%. Tesla remains the leading EV company in the US and most of the world. Its performance has been surpassed by BYD in China, which is the world’s largest car market. Tesla’s shares are up 100% after a strong year.
Tesla has a market cap of $755 billion, which ranks it ninth among all companies traded on US exchanges and just shy of the market value of Warren Buffett’s Berkshire Hathaway (NYSE: BRK-A). By contrast, Ford’s (NYSE: F) market cap is $47 billion, and General Motors (NYSE: GM) is $49 billion. Ford did get a win in the EV market.
Musk has led Tesla since 2008, when the EV manufacturer was in its infancy. He has captained the market launch of its entire vehicle line, including its new Cybertruck pickup. There have been criticisms about the quality of Tesla’s vehicles and whether its autopilot system is safe. Nevertheless, Tesla vehicles continue to be considered state-of-the-art.
Musk has also been praised for his ability to beat his major competitor. Tesla has over 50% of the US EV market. The balance is splintered between start-ups and major car companies. Musk has used price discounts to hold its market share position. This has hurt Tesla’s margins. It is too early to say if the strategy will work long-term.
What happens now? Tesla’s board is highly unlikely to take action. Musk also leads SpaceX, which has several government contracts, which might expose him to an investigation. For now, however, he is considered the most innovative business executive in the world.
ALERT: Take This Retirement Quiz Now (Sponsored)
Take the quiz below to get matched with a financial advisor today.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Take the retirement quiz right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Editors' Picks
