Investor Michael Burry, famous for his bets against the 2008 housing market, has taken aim at Elon Musk's Tesla, calling the electric vehicle maker "ridiculously overvalued" and raising concerns over shareholder dilution.
In a Sunday post on his Substack newsletter, "Cassandra Unchained," Burry wrote, "Tesla's market capitalization is ridiculously overvalued today and has been for a good long time."
According to Fox Business, he added that Tesla reduces existing shareholders' stakes by roughly 3.6% each year due to continued share issuance and the lack of buybacks, a figure he says will grow under Musk's recently approved $1 trillion compensation plan.
Last month, Tesla shareholders voted to approve Musk's pay package, the largest executive compensation plan on record.
The plan would give Musk up to 12% of Tesla's stock, worth $1 trillion if the company reaches an $8.5 trillion market capitalization and hits other performance milestones over the next decade.
Currently, Tesla's market value is about $1.43 trillion, making it the world's most valuable automaker, with Musk owning roughly 13% of shares.
Short seller Michael Burry says $TSLA is "ridiculously overvalued."https://t.co/A0crKPHX09 pic.twitter.com/E8yWBk6q7w
— Yahoo Finance (@YahooFinance) December 1, 2025
Michael Burry Questions Tesla's Valuation
Burry also criticized Tesla's culture of hype, writing, "The Elon cult was all-in on electric cars until competition showed up, then all-in on autonomous driving until competition showed up, and now is all-in on robots — until competition shows up."
In 2021, he made headlines for taking a massive short position against Tesla, valued at around $530 million. He eventually closed the position, calling it "just a trade."
Tesla shares were trading around $427–$430 on Monday, slightly down from the previous session, after climbing sharply over the past year on investor optimism about growth plans.
Despite the company's rising stock, Burry and other critics, like famed short-seller Jim Chanos, argue Tesla remains overvalued, trading at over 250 times earnings, far above traditional automakers, BusinessInsider reported.
Musk's vision for Tesla includes robotaxis and the Optimus robot, though the company faces competition from Google-backed Waymo and Chinese robotics startup Unitree.
Tesla currently holds about 41% of the US electric vehicle market, a lead that has narrowed as more EV competitors emerge.
Burry's comments come amid his broader critique of the tech sector. Last month, he disclosed bets against Nvidia and Palantir, questioning the AI boom and accusing major providers of inflating profits with aggressive accounting.
Originally published on vcpost.com
