Tesla Senior VP sells 82% shares, CEO Elon Musk says ‘If they don’t….they will be…’

Tesla Senior Vice President Xiaotong Zhu, also known as Tom Zhu, has sold more than 82% of his Tesla holdings since 2023. According to securities filings, the sales took place between 2023 and 2024, with shares sold at prices ranging from $174 to $323 each. The move has raised questions about insider confidence in the company as CEO Elon Musk continues to warn short sellers. Replying to a post on X (formerly Twitter) with the le list of the current net short sellers of the EV maker, Musk said they would be “obliterated” once Tesla reaches full autonomy.

The Tesla CEO wrote: “If they don’t exit their short position before Tesla reaches autonomy at scale, they will be obliterated”.

What is short selling

Short selling is a trading practice used when investors believe a stock price will fall. An investor borrows shares of a company from a broker and sells them immediately at the current market price. Later, if the stock price drops, the investor buys back the same number of shares at the lower price, returns them to the broker, and keeps the difference as profit.

For example, if someone borrows 10 Tesla shares at $300 each and sells them for $3,000, and the price later falls to $250, the investor can buy them back for $2,500, return the shares, and keep $500 as profit.

The risk is that if the stock price rises instead of falling, the investor still has to buy back the shares at the higher price, which can lead to unlimited losses. This is why short selling is considered one of the riskiest trading strategies.

When Elon Musk warned Bill Gates will go bankrupt

Elon Musk’s latest remarks add to his past clashes with short sellers, including Microsoft co-founder Bill Gates. The feud between the two originates from Gates’ reportedly short position against Tesla stock. According to Walter Isaacson’s 2023 biography of Musk, this position has allegedly cost Bill Gates a $1.5 billion loss.

In the post on X last year, Musk said that “If Tesla does become the world’s most valuable company by far, that short position will bankrupt even Bill Gates”.