Elon Musk now world's second-richest as Tesla market value crosses US$500 billion

About three-quarters of Mr Musk's net worth is comprised of Tesla shares. PHOTO: AFP

NEW YORK (BLOOMBERG, REUTERS) - Elon Musk's year of dizzying ascents hit a new high as the Tesla co-founder passed Bill Gates to become the world's second-richest person.

The 49-year-old entrepreneur's net worth soared US$7.2 billion to US$127.9 billion (S$171.6 billion), driven by yet another surge in Tesla's share price. Mr Musk has added US$100.3 billion to his net worth this year, the most of anyone on the Bloomberg Billionaires Index, a ranking of the world's 500 richest people. In January he ranked 35th.

His advance up the wealth ranks has been driven largely by the electric-car maker, whose market value passed US$500 billion on Tuesday (Nov 24). Tesla shares surged 6.4 per cent to US$555.38 in New York, extending a meteoric rally that has seen the stock gain more than six times this year.

The stock has risen nearly 28 per cent since the S&P Dow Jones Indices decided to add the company to the benchmark index from Dec 21.

Tesla has become by far the world's most valuable automaker, despite a production that is a fraction of Toyota Motor, Volkswagen or General Motors.

Shares of other electric vehicle (EV) makers have also risen in the last few months as US President-elect Joe Biden made boosting EVs a top priority during his campaign.

"One of the core underpinnings of the Biden platform will be around pushing clean energy and zero-emissions vehicles with hopes of accelerating the deployment of electric vehicles and public charging outlets by 2030," Wedbush analyst Daniel Ives said in a note.

About three-quarters of Mr Musk's net worth is comprised of Tesla shares, which are valued more than four times as much as his stake in Space Exploration Technologies or SpaceX.

Mr Musk's milestone marks only the second time in the index's eight-year history that Microsoft co-founder Mr Gates has ranked lower than number two. He held the top spot for years before being bumped by Amazon.com founder Jeff Bezos in 2017. Mr Gates's net worth of US$127.7 billion would be much higher had he not donated so prodigiously to charity over the years. He has given more than US$27 billion to his namesake foundation since 2006.

With Monday's move, Mr Musk unseats an occasional verbal sparring partner in Mr Gates, who the Tesla billionaire has ridiculed on Twitter for, among other things, having "no clue" about electric trucks. The two have also traded barbs over Covid-19. Mr Gates, whose charitable foundation is one of the preeminent bodies backing vaccine research, has expressed concern over Mr Musk's stated suspicion of pandemic data and embrace of certain conspiracy theories.

The year has been a lucrative one for the world's richest people. Despite the pandemic and widespread layoffs that have disproportionately affected the world's working class and poor, the members of the Bloomberg index have collectively gained 23 per cent - or US$1.3 trillion - since the year began.

Those in the electric vehicle industry, though, have been particular beneficiaries. The combined fortune of Zeng Yuqun and Huang Shilin, chairman and vice chairman of China's biggest EV battery maker, Contemporary Amperex Technology, has soared by US$18.8 billion year-to-date, according to the index.

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