Tesla Investors Prepare for Shakeup as Musk Consider Ryanair Purchase
Tesla CEO Elon Musk considered buying Ryanair this week, and Tesla stock is down dramatically with much of the market.
Quick overview
- Elon Musk's suggestion to buy Ryanair follows the airline's refusal to install Starlink antennas, leading to a public spat with CEO Michael O'Leary.
- Tesla's stock dropped 4.3% after the exchange, exacerbated by broader market declines due to trade tariff threats from President Trump.
- Investors are concerned about the potential debt from a Ryanair acquisition, especially as Tesla focuses on proving profitability amid heavy AI investments.
- Musk's past social media interactions have led to significant business decisions, raising questions about the seriousness of his Ryanair proposal.
Ryanair may be the next purchase for billionaire Elon Musk, but would that disrupt Tesla’s shaky market position after a poor year for sales and growth?
Tesla (TSLA) stock dropped sharply on Tuesday after CEO Elon Musk floated the idea of buying Ryanair after the airline company refused to install his Starlink satellite on their planes. A heated exchange ensued between Musk and Ryanair CEO Michael O’Leary over the topic, with Musk tweeting about buying the company and replacing the CEO.
O’Leary rejected the notion of adding a satellite antenna to their planes because he says it would cost them millions in fuel drag. Musk was quick to fire back and called the CEO an idiot. It may not be long before Tesla has to field a public relations nightmare.
Tesla Stock Reacts
The exchange between the two CEOs started on Friday, but Martin Luther King Jr. Day kept the markets from reacting right away on Monday. On Tuesday, as the market opened, Tesla stock fell 4.3%. Not all the blame for Tesla’s decline can be blamed on Musk’s attacks on O’Leary and any plans he suggested to buy Ryanair. The stock markets were in sharp decline on Tuesday as President Donald Trump threatened European trade partners with steep tariffs.
Investors may wonder whether Musk is serious about buying Ryanair. One of his tweets was worded as, “Should I buy Ryan Air and put someone whose actual name is Ryan in charge?” It should be noted that Musk has made major business decisions in the past after social media exchanges similar to this one. There was an interaction very much like it back in 2017 when he asked how much Twitter cost. He purchased the platform five years later and rebranded it as X.
A major purchase Ryanair could saddle Tesla with debt, especially if Musk decides to connect the two companies somehow. At this point, Tesla needs to prove profitability to shareholders, especially after heavy investments into AI technology. As the company prepares to roll out greater AI integration and new Optimus robots with AI decision-making functionality, this is a key time for the company to show it can turn a profit with artificial intelligence.
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