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Elon Musk has long enjoyed a loyal band of Tesla<\/a> shareholders, who have helped boost the company to stock market stardom<\/a> over the past five years. <\/p>\n However, according to Bill Gross\u2014also dubbed the \u2018Bond King\u2019\u2014this band of backers are now little more than meme stock traders: the retail investors who followed the likes of RoaringKitty to push GameStop<\/a> shares to dizzying heights. <\/p>\n The comparison between EV-maker Tesla\u2014a Magnificent 7 stock that has significantly disrupted the automotive industry in recent years\u2014and\u00a0viral stocks like GameStop<\/a>, Blackberry, and AMC Theaters signals a wider trend in market behavior,<\/span> according to Gross.<\/p>\n The bond fund billionaire, who founded investment management firm PIMCO in the 1970s, took to Musk-owned social media platform X<\/a> to share his thoughts Tuesday. <\/p>\n \u201cTesla acting like a meme stock \u2014 sagging fundamentals, straight up price action,\u201d he wrote. \u201cBut then there seems to be a new meme stock every other day now. Most are pump and dump. Chewy<\/a>. Zapp. And old favorite GME.\u201d<\/p>\n Tesla did not immediately respond to Fortune\u2019s<\/em> request for comment.<\/p>\n Tesla acting like a meme stock \u2014 sagging fundamentals, straight up price action.<\/p>\n But then there seems to be a new meme stock every other day now.<\/p>\n Most are pump and dump.<\/p>\n Chewy. Zapp. And old favorite GME.<\/p>\n \u2014 Bill Gross (@real_bill_gross) July 9, 2024<\/a><\/p><\/blockquote>\n <\/p>\n The Musk-led electric vehicle behemoth is facing some tough challenges, namely staying competitive as\u00a0cheaper, attractive alternatives flood the market<\/a><\/span> and ensuring it has the supply of parts it needs to continue production at scale<\/a>.<\/p>\n Earlier this month, Austin-based Tesla exceeded analysts\u2019 expectations when it\u00a0announced Q2<\/a>\u00a0deliveries of approximately 444,000. This represented a 5% drop<\/span> from last year, which was ahead of expectations. <\/p>\n Tesla\u2019s shares have increased in the week or so since the earnings call, up approximately 14% at the time of writing<\/a>.<\/p>\n However, despite the reprieve Q2<\/a> brought, Musk and his team will still be looking over their shoulders at Chinese automaker BYD. <\/p>\n In early July, the Shenzhen-based manufacturer announced a 21% rise in EV sales, which,\u00a0per Reuters calculations, equates to 426,039 cars sold between April and June.<\/p>\n The Chinese manufacturer is increasingly being adopted in Western markets and unlike Tesla isn\u2019t afraid of a bit of advertising<\/a>. <\/p>\n Take its sponsorship of the Euros soccer tournament in this summer, increasing consumers\u2019 awareness of the brand which has a cheaper entry point than its American rival.<\/a><\/p>\n Tesla has begun to concede crowns in recent years. Even record sales in 2023 were not enough for the Musk entity to beat off Warren Buffett-backed BYD to secure the top spot for vehicle sales as the year came to a close<\/a>. <\/p>\n In Q4 Tesla\u00a0said<\/a>\u00a0it delivered 484,507 cars to customers globally between October and December, selling nearly 1.81 million cars during 2023 for a very respectable gain of 38%.\u00a0<\/p>\n BYD, on the other hand, cinched the title of the world\u2019s largest EV maker that quarter by announcing it finished the fourth quarter with a record 526,400 EVs sold, delivering 1.59 million fully electric vehicles in 2023 with a 73% gain over the previous year. <\/p>\n Likewise, Tesla\u2019s once seemingly unshakeable market share position has been declining in recent years, according to automotive research specialists Kelley Blue Book (KBB).<\/p>\n KBB reported earlier this year that in Q3 2023, Tesla\u2019s market share fell below 50% for the first time.\u00a0It<\/a>\u00a0was down 75% from<\/span> 2022 and 62.4% at the outset of 2023.<\/p>\n Another problem Tesla is facing is securing enough chips to power its technology\u2014and it\u2019s not alone. <\/p>\n However, a factor other businesses don\u2019t have to contend with is the supply earmarked for one business being redistributed to another.<\/p>\n Last month Musk, the richest person on earth worth $274 billion per the Bloomberg Billionaire\u2019s Index<\/a>, admitted to diverting Nvidia\u2019s AI chips originally destined for\u00a0Tesla<\/a>\u00a0to his latest startup xAI and social media company\u00a0X<\/a>.<\/p>\n \u201cTesla had no place to send the Nvidia chips to turn them on, so they would have just sat in a warehouse,\u201d he posted.\u00a0<\/p>\n Yet the very fact Musk has such huge resources at his disposal may be a factor which holds some appeal for the Tesla shareholders who voted through his record-breaking pay package. <\/p>\n After all, he has told analysts<\/a> to stop viewing the EV maker as an automotive company and instead value it like a robotics or AI venture.<\/p>\n While analysts are unconvinced\u2014launching criticism of overpromising and underdelivering while others\u00a0have speculated Tesla should be axed as a Magnificent 7 stock<\/a>\u2014the fact remains that\u00a0<\/span>the Model X maker is still in a neck-and-neck race to be the world\u2019s largest EV maker.<\/p>\n With its share price is up a staggering 1,511% over the past five years, the question remains as to whether Tesla has what it needs under the bonnet (metaphorically) to stay ahead of meme stock comparisons. <\/p>\n<\/div>\n\n\n
The BYD<\/a> issue<\/h2>\n
Tesla and AI<\/h2>\n
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