Elon Musk had a Huge 2021. Can 2022 Compare?
Is Elon Musk saving humanity, or is he everything that is wrong with the world? Is he a messianic super genius or just a master of hype? Playful? Dangerous? Both?
For good or for ill, what’s clear is that Elon Musk is making a mark on the world. He’s currently the richest person on Earth. Many of his companies — especially Tesla and SpaceX — are making waves in their industries. The tech media hangs on every word he utters, and billions of dollars worth of capital flow in and out of cryptocurrencies and stocks when he tweets jokes. His fans are fiercely loyal, his critics absolutely loathe him. He’s a bonafide celebrity, one of Twitter’s most prolific users, and, it can't be said too much, very rich.
There’s one thing about Elon Musk that everyone can agree on: he makes us feel things. With Musk in the news so often, it’s easy to lose track of the bigger picture, so here’s an overview of what he did last year and some informed speculation about what 2022 might hold for one of the biggest personalities in tech — or anywhere else.
It was, by any measure, a very big year…
The centi-billionaire kicked off 2021 by (briefly) outsing Amazon founder Jeff Bezos as the richest person in the world. The main reason Musk grew so rich is that Tesla — the electric car company he joined in 2004 with an investment of $6.5 million — announced that month that it had turned an annual profit for the first time ever. The carmaker made a profit of more than $700 million on sales of $31 billion. Musk owned about one-fifth of Telsa at the time. January also saw Musk convince a lot of people — including a large number of small investors — to buy shares in a so-called “meme stock” that was being hyped by Reddit users. The price of Gamestop stock rose by 50% when the billionaire tweeted “GameStonk” on January 26. The move was part of an apparently grassroots effort to pull one over on the establishment by forcing professional traders who’d bet against the stock to suffer heavy losses when its value increased. The episode turned the billionaire into an unlikely folk hero for many people who felt aggrieved by the financial system.
Musk continued moving markets in February when he caused the price of crypto-joke Dogecoin to increase by more than 60% with a tweet. The next month, he pushed Bitcoin to set a new record by announcing that Tesla would accept the cryptocurrency as payment for cars.
Musk notched a major win in April when NASA announced that it would award Musk’s SpaceX — and not Jeff Bezos’ Blue Origin — a coveted $2.9B contract to build the moon lander for the Agency’s Artemis program. The series of missions aims to send humans back to the moon for the first time in 50 years and establish the capacity for “sustainable lunar exploration” in the 2020s.
In May, Musk hosted Saturday Night Live and claimed to be “the first person with Asperger’s to host the show — or at least the first to admit it.” Fact-checkers contend that designation went to Dan Aykroyd nearly 20 years ago when the former cast member returned to SNL as a host in 2003. A few days later, Musk sent the price of Bitcoin into freefall after reversing the company’s stance on Bitcoin. He said that Tesla would no longer accept the cryptocurrency as payment due to concerns about its environmental impact. In response to the news, the crypto market lost about 15% of its total value — bringing that figure to just more than $2T — in the hours after he tweeted the announcement.
After a relatively quiet summer, Musk became the first space baron to send a crewed mission into space without any astronauts on board. In September, four civilians traveling aboard a Falcon 9 rocket traveled 360 miles above Earth’s surface — well beyond the orbit of the International Space Station. Later that month, Tesla stock surged again, sending Musk back to the top of Forbes' list of the world’s richest people and making him only the third person ever to be worth more than $200 billion. In October, news that rental car company Hertz would buy 100,000 Teslas caused the carmaker’s stock price to jump yet again, this time by 12%. That placed the total value of its shares at more than $1 trillion, making it just the sixth US company ever to be valued so highly by stock market investors.
In November, after receiving pressure over the small amount of tax he pays, Musk tweeted a poll asking if he should sell 10% of his Tesla stock, a move that would make that portion of his wealth subject to income tax. More than 3.5 million users voted yes, though financial filings indicate that Musk had already decided to sell most of those shares, as he faced a massive tax bill on the gain in share options that were awarded to him in 2012 and set to expire in August 2022.
And in December, Musk capped off the roller coaster ride of a year by joining the likes of Martin Luther King, Jr., Adolf Hitler, and Barack Obama as Time Magazine’s Person of the Year.
It wasn’t all roses, though. His ballooning wealth and political posturing brought plenty of criticism, and a number of scandals at his companies left many to wonder just how far he’s willing to go to accomplish his goals.
… But the scandals continued to pile up
The biggest Elon Musk story of 2021 — and of 2020 and (presumably) of 2022 — was his skyrocketing wealth. He made more money last year than anyone else in the world, growing his fortune by $121 billion. That made him a key figure and loud voice in the national conversations about wealth, poverty, economic inequality, and taxation. The scrutiny increased over the summer when nonprofit news outlet ProPublica released a bombshell report showing that Musk (although hardly alone among extremely rich people) paid a “true tax rate” of just 3.27% between 2014 and 2018, and no federal taxes at all in 2018, a fraction of what normal people pay.
Musk has responded to much of the criticism by arguing that his goals transcend what the government could do with his money — and with personal attacks against those who speak out. For example, in November Musk told Bernie Sanders, “I keep forgetting that you’re still alive” after the 80-year-old senator tweeted. “We must demand that the extremely wealthy pay their fair share. Period.” When Oregon Senator Ron Wyden said of Musk’s Twitter poll about selling 10% of his Tesla stock, “Whether or not the world’s wealthiest man pays any taxes at all shouldn’t depend on the results of a Twitter poll. It’s time for the Billionaires Income Tax.” Musk replied, “Why does ur pp look like u just came?”
Musk will pay taxes this April — maybe the largest individual tax bill in U.S. history. It’s not really because of his much-discussed sell-off of Tesla stock, though. Earlier in the year, Musk took advantage of an option in his employment contract with the company to buy stock at its 2012 price. The 23 million new shares he bought at $6.24 apiece quickly became worth $1,222.09 each, causing his fortune to grow by $28 billion. The proceeds of his stock sale will likely be used to cover the tax bill, as he probably intended all along.
Musk has claimed that he’s not accumulating wealth out of greed, tweeting in December that he thinks, “the government is inherently not a good steward of capital.” Critics pointed out that Musk has benefitted from allocations from the government, including a critical half-billion-dollar loan Tesla received as part of the federal government’s auto industry bailout in 2009. Most Teslas sold have been subsidized with a $7,500 tax credit. He claimed earlier in the year that he’s, "accumulating resources to help make life multiplanetary [and] extend the light of consciousness to the stars".
2021 also saw a number of complaints about workplace practices at Tesla’s plant. In March, the National Labor Relations Board announced that Musk had violated labor laws by firing a union organizer (who the agency made the company re-hire and compensate) and sending out an anti-union tweet (which the agency made him delete). In July, Wall Street Journal reporter Tim Higgins published Power Play, a history of Tesla that paints an unflattering picture of Musk, who, “serves not as main character but dramatic foil to those doing their best under chaotic, dysfunctional conditions,” according to one review.
In October, a San Francisco court ordered Tesla to pay an ex-employee, who is a black person, almost $140 million for allowing racist workplace misconduct that violated the Civil Rights Act of 1866. And in December, six women filed separate sexual harassment lawsuits against the company, claiming that Musk’s Twitter presence helped facilitate a hostile workplace at his male-dominated company.
So, what does 2022 hold?
Musk is coming into the New Year with a lot of momentum. Analysts think the global market for electric vehicles is going to continue its exponential rate of growth, maybe increasing about 40% over last year. That’s very good news for Musk because the fate of his fortune is tied so closely to investors’ confidence that Tesla will continue making lots of profits. The company's stock price has had a bumpy start to 2022, though. At press time, the value of Tesla stock was down by more than 22% since the beginning of the year. A lot of tech stocks have had a tough January, but Tesla's performance is much worse than the NASDAQ, which is currently down more than 12% on the year.
Several signs indicate that Tesla will make big moves toward making its own batteries, though it's unclear what changes will occur before 2022 is over. In September, Tesla broke ground a new “mega-factory” in California, where it will manufacture batteries. Earlier this month, the company made a deal with an Australian mining company to acquire graphite — an important part of lithium-ion batteries — from a mine it operates in Mozambique. An analyst told CNBC that the deal is likely part of the U.S. government’s larger plan to, “ build enough capacity domestically to be able to build [lithium-ion batteries] within the USA,” reducing reliance on China.
But it’s not all roses at Tesla. Musk himself has admitted that building a self-driving car, which is one of Tesla’s main ambitions, has turned out to be harder than he thought. A number of people have been killed in accidents apparently caused by the company’s driver-assist or full self-driving software, which Bloomberg notes, “isn’t actually capable of full self-driving,” despite costing customers $10,000 per vehicle. The Cybertruck, Tesla Semi, and next-generation Roadster have also all have faced significant production delays.
There’s no doubt that 2022 will be a huge year for Musk’s space ambitions. The constellation of satellites operated by Starlink, Musk’s company that aims to blanket the Earth in as many as 10,000 satellites that beam Internet down to users, has swelled to 2,000. But it's getting some pushback from country's that claim it is cluttering up space and making research more difficult. SpaceX’s deal with NASA will keep the company central to the biggest gambit to send humans into space since the Apollo missions a half-century ago. The company is also making big strides in bringing down the cost of delivering cargo to space, which is a key for the burgeoning space economy.
And what about his other endeavors? Neuralink, Musk’s company that builds computer-brain interfaces, recently announced it’s hiring a clinical trials director. That could indicate big announcements to come. Musk has said in the past that the company’s technology “will enable someone with paralysis to use a smartphone with their mind faster than someone using thumbs.” Tesla will supposedly reveal the prototype of its new humanoid robot this year, too.
Of course, no one can confidently predict what’s going to happen this year or beyond. The pandemic continues to make planning all but impossible, the snarled supply chain is still casting uncertainty on pretty much everything and calls for taxing the rich and regulating tech companies have only grown louder. And of course, what Musk says doesn’t always come true.
What he does always does manage to do is keep us talking about his next big thing — and about him.