Why did Elon Musk buy Twitter? Maybe to sell his cars

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There are a bunch of competing meta-theories of what Elon Musk is up to with, you know, Twitter Inc., all this. Here are two straightforward, first-order theories:

  • Elon Musk is very rich and has eccentric hobbies, his favorite hobby is getting in fights online, and nobody around him ever tells him to knock it off. So all this stuff is bad, but it’s what he wants — at least, what he wants in the moment — so he does it. “Musk is just a being of pure impulse,” writes Ryan Broderick. “He’s essentially a flatworm with a rocket company.” I too am excessively online, so I sympathize with this view.
  • Elon Musk genuinely and correctly believes that buying Twitter and making it, like, a division of QAnon is the most important thing that he can do for humanity. “The woke mind virus is either defeated or nothing else matters,” he tweeted: Sure his other businesses are about rockets and electric cars, about making humanity multiplanetary and solving climate change, but those problems are trivial compared to the real work of tweeting memes about Anthony Fauci. I do not pretend to understand this view, but (1) it is Musk’s own stated theory of what is going onand (2) a lot of his venture-capitalist buddies seem to believe it, so I do not want to write it off entirely. I mean, I do. But here it is.

But I am also drawn to two weirder and more convoluted theories:

  • Tesla Inc. stock is the main source of Musk’s wealth, and he has done a good job of maximizing that stock’s price by rallying a legion of retail fans. But eventually he needs to cash out, and that presents a problem: If the founder, chief executive officer and cult leader of Tesla starts dumping stock, then that signals a loss of confidence, and the stock would collapse before he could get much money out of it. But if he created a distraction, or an excuse, for dumping the stock, then that might cushion the blow. Not “I am selling $40 billion of Tesla stock to top-tick it” but more like “I am selling $40 billion of Tesla stock to buy Twitter and wage war for the future of civilization.” Then his fans might say “great, sell that stock, wage that war,” and he can sell stock without taking too much of a hit. And in fact Musk has sold almost $40 billion of Tesla stock, after repeatedly promising that he was done. We have talked about this theory before, but I find it somewhat unsatisfying because (1) in fact Tesla’s stock has gone down a ton as he’s been selling! and (2) he has plowed most of the proceeds into buying Twitter, which has probably gone down even more! I do not see how he has accomplished any real diversification or stock-price-maintenance goals. 
  • Tesla Inc. is the main source of Musk’s wealth, and his main goal in life is selling lots of Teslas. He has sold all the Teslas that he can sell to coastal elite liberals, and now he faces the daunting challenge of selling electric cars to social conservatives. Acquiring Twitter and turning it into a right-wing media company with himself as the main character might be bad for, like, Twitter ad sales, but that is small potatoes if it is good for selling Teslas to Republicans. “Our cars are electric, yes, but they are free from the woke mind virus” is perhaps a good pitch.

Those last two theories have opposite implications for what you should think about all this if you are a Tesla shareholder. If you think that Musk’s purchase of Twitter is meant to provide a distracting cover for his loss of interest in Tesla, seems bad! If you think that Musk’s purchase of Twitter is meant to open up new markets for Tesla then, you know, give him a chance, see where this is going.


Elon Musk sold another $3.58 billion worth of Tesla Inc. shares, bringing the total amount he’s offloaded since late last year to almost $40 billion.

The latest disposal of about 22 million shares this week coincided with Musk falling from the top spot on the Bloomberg Billionaires Index, a position he’d occupied since September of last year. Tesla’s market value also slumped below the half-trillion-dollar mark for the first time since November 2020.

Musk’s persistent selling after repeated assurances that he was done unloading Tesla stock reflects mounting pressure on the finances of Twitter Inc. His erratic and impulsive approach to running the social-media company has alienated advertisers, and efforts to bring in more revenue from subscription fees backfired when impostor accounts exploited a poorly executed rollout of verification badges.


The chorus of Tesla Inc. individual investors expressing misgivings that Chief Executive Elon Musk‘s involvement with Twitter Inc. may be to the detriment of the electric-vehicle maker is getting louder, with the car company’s stock on track for its worst full-year performance.  

“There is no TSLA CEO today,” Gary Black, managing partner of the Future Fund LLC, which owns roughly $50 million worth of Tesla, tweeted Monday. …

Mr. Black said, “The market voted today that the $TSLA brand has been negatively impacted by the Twitter drama. Where before EV buyers were proud to drive their Teslas to their friends or show off Teslas in their driveways, now the Twitter controversy is hurting Tesla’s brand equity.”

Yeah I mean if you are an asset manager you are maybe less proud to show off your Tesla, but how many Teslas can Musk possibly sell to asset managers?