Elon Musk's Latest Counter-Attack on Tesla Short Sellers: Will They Be 'Obliterated'?

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In yet another audacious move, Elon Musk has set his sights on the persistent band of investors who have dared to short Tesla's (TSLA) stock. In a tweet that can only be described as quintessentially Muskian, he confidently predicts that these short sellers will be “obliterated.”

Short sellers, those market participants who wager against the upward trajectory of a company's stock, have been a recurring thorn in the side of Tesla. Musk, never one to shy away from a skirmish, has a long history of lambasting these so-called 'shorts,' often predicting their ruin with a theatrically prophetic air.

Historically, Tesla has shown up on the NASDAQ's list of most shorted stocks. However, as the company edged toward profitability, the shorts started to lose ground — quite literally in terms of financial losses. Yet, the rollercoaster doesn't stop there.

The Rise and Fall of Tesla's Stock

The year started on a rough note for Tesla, with short sellers making some gains as the company's stock took a nosedive in the first half. But in a seismic shift, Tesla's stock soared by an impressive 30% over the last week, renewing the interest and activity among short sellers.

Hedge fund tracker Hazeltree notes a rise in short interest on Tesla's stock, while NASDAQ’s latest reports pegged short interest at a manageable 1.5 days to cover. For those with an eye on history, this is a mere blip compared to the levels observed between 2017 and 2020.

Musk’s Proclamation: A New Era?

In a zealous burst of confidence, Elon Musk shared on X (formerly Twitter) that he expects short sellers to meet their demise once Tesla cracks the enigma of self-driving technology and achieves volume production with Optimus, Tesla's humanoid robot:

“Once Tesla fully solves autonomy and has Optimus in volume production, anyone still holding a short position will be obliterated. Even Gates.”

Yes, Musk was referring to none other than Bill Gates, a known occasional short-seller of Tesla stock. The mention of Gates only adds spice to Musk’s already peppered declarations.

Electrek’s Perspective

This latest bravado from Musk raises eyebrows and questions in equal measure. Why does he continue to make these proclamations? Naturally, short sellers would be crushed if Tesla mastered full autonomy. Shorts are betting on the improbability of such a feat within a competitive timeframe.

So far, the skeptics have been on point. Despite annual proclamations since 2019 that Tesla would crack autonomy by year-end, the reality has yet to align with these ambitious forecasts. Musk himself has stated that non-believers in Tesla’s autonomy goal should steer clear of investing in its stock.

Conversely, it's easy to argue that skeptics should be shorting Tesla. If one doesn’t believe in the company’s ability to pioneer self-driving, placing a bet against it seems logical.

Interestingly, this antagonism towards short sellers is somewhat baffling. Historically, shorts have inadvertently boosted Tesla’s stock value. Key leaps in Tesla’s market valuation have been propelled by short squeezes — where doubters were forced to buy back shares at higher prices, driving the stock even higher.

In summary, Elon Musk’s latest forecast of doom for Tesla’s short sellers adds another chapter to this ongoing high-stakes drama. Whether his proclamations prove prophetic or not, one thing is certain — the Tesla saga remains as electrifying as ever.

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