Elon Musk Boosts Tesla Stake with One Billion Dollar Share Purchase

Elon Musk has reaffirmed his confidence in Tesla by making his first open market purchase of Tesla shares since 2020, acquiring approximately $1 billion worth in a bold move that sent the electric carmaker’s shares surging. The acquisition, made through a revocable trust, saw Musk adding 2.6 million shares at prices ranging from $372 to $396, increasing his already significant holding of 13 per cent in the firm.

This demonstration of commitment comes as Tesla’s board prepares to ask shareholders for approval on a substantial new pay package for Musk, worth $1 trillion. The deal challenges Musk to grow the company’s market capitalisation from its current $1.3 trillion to an ambitious $8.5 trillion by 2035. If he succeeds in meeting a series of demanding milestones—including delivering 20 million vehicles, deploying one million Optimus robots, and rolling out a fleet of a million robo-taxis—Musk’s stake could climb to at least 25 per cent of the business.

The share purchase had an immediate impact, with Tesla’s stock price climbing almost ten per cent to a peak of $430 before closing at $410.26, up 3.6 per cent for the day. Over the past week, Tesla’s shares have gained 18 per cent, approaching last year’s all-time high of $480 per share. The last time Musk bought Tesla shares on the open market was in February 2020, when he spent around $10 million. Since then, he sold approximately $20 billion worth of shares in 2022, much of it linked to his acquisition of Twitter.

The latest pay proposal is designed to refocus Musk on Tesla amid concerns over the impact of his political and business activities on the brand and its results. The company’s profits dropped by over 70 per cent in the first quarter of the year. As part of the pay deal, Musk is expected to scale back his public political interventions, having recently ended his advisory relationship with the Trump administration.

Chairwoman Robyn Denholm has emphasised that if Musk achieves all targets set by the new plan, he will help propel Tesla to become the most valuable company in corporate history. Denholm dismissed assertions that Musk’s other commitments have impeded sales, stating he is now fully engaged in advancing the group’s future, particularly in artificial intelligence, robotics and the robotaxi sector.

Musk himself remains optimistic about Tesla’s prospects, though he has cautioned that the expiration of US government incentives for electric vehicle purchases could result in ‘rough quarters’ ahead. Nevertheless, his latest share purchase is a clear message to investors of his belief in the business and his readiness to lead Tesla towards unprecedented growth.