Operation Elon: The Aussie who made $820m selling her Tesla shares

The Age

16-05-2025

Let's start with a different question: why is this respected Silicon Valley veteran selling?
Who would not want to own shares in a company that – as its return to the trillion-dollar valuation club demonstrates – seems to be protected from any sense of economic logic.
Sales continued to plunge across its biggest European markets last month, despite a long-awaited update of its most popular car.
While leaving Tesla on self-drive mode, Musk found time to support extreme right-wing causes across Europe which triggered a plunge in sales on the Continent, as well as the Trump administration which is waging a global trade war that is also costing Tesla dearly.
And when reports emerged that Tesla's directors were searching for a potential replacement for Musk – a very sensible decision for any board in the circumstances – Denholm made a public statement declaring the report to be 'absolutely false' and made it clear that Tesla and its founder Musk were joined at the hip.
'The CEO of Tesla is Elon Musk and the board is highly confident in his ability to continue executing on the exciting growth plan ahead,' she said in a tweet on his social media platform, X.
It is no wonder this board was slammed by a US court judge over a $US56 billion pay packet for Musk. It was accused of acting as enabler for the company founder, not as an overseer for investors.
But the rules are different at Tesla.
Its trillion-dollar valuation only makes sense if you look at it as a meme stock – a company that suddenly goes viral on social media and its shares skyrocket for no clear reason. And Musk is its meme. Denholm seems to get this.
Any valuation currently subscribed to Tesla left reality a long time ago, and the only tether with valuations on planet Earth is its mercurial founder.
Tesla's valuation was extraordinary enough when it was merely worth more than every other carmaker on the planet combined. That was based on the idea that it had too much of a lead on e-vehicles – the car of the future – for anyone else to catch it.
While US and European sales reflect repugnance for Musk's politics, the fall-off in China reflects a far more sobering reality: Tesla is way behind its multitude of Chinese rivals on every significant feature: price, recharging times and autonomous driving features which are now offered free on some Chinese cars.
Keep in mind that the future earnings which underpin its current $US1.1 trillion valuation are expected to shrink if his Republican buddies successfully gut electric vehicle subsidies to the tune of billions of dollars. And the price investors pay for each dollar of Tesla's profit far exceeds dominant tech rivals like Nvidia, Apple and Microsoft.
Cars clearly don't drive its valuation now, it is the market perception of Musk's ability to morph the company into a dominant force in AI, robotaxis and humanoid robots.
That is a much harder argument to make in the current environment.
Any valuation currently subscribed to Tesla left reality a long time ago, and the only tether with valuations on planet Earth is its mercurial founder.
You don't need to go outside the US borders to see what significant competition Tesla faces on the AI front. And China appears to be streets ahead when it comes to autonomous driving, robotaxis and is already talking about AI-aided robots as its next workforce.
It underlines that Denholm's one job at Tesla is to keep Musk interested enough to ensure he gives the company a decent crack at the impossible task before it.
The issue is not whether Tesla is a valuable company, it is whether it is worth anything remotely close to the current market valuation.
It gives an interesting context to Denholm's massive stock sale which has left her with shares worth around $US27 million.
Her Tesla stake is almost certainly worth less than her trophy homes in Sydney and nearby Whale Beach where she reportedly tried, and failed, to get approval for a lift to be installed that would deliver her to the sun-kissed sand.
If she isn't willing to hold shares she paid almost nothing for, other investors should take heed.