Tesla shares tumble after Musk interview sparks fresh fears

  • Tesla shares tumble after Musk interview sparks fresh fears

Tesla shares tumble after Musk interview sparks fresh fears

Isolating exactly which issue at Tesla is making shareholders the most nervous is hard, but the New York Times interview with Musk, published on Friday, doesn't seem to have done much in the way of softening the electric vehicle company's PR problems.

"This past year has been the most hard and painful year of my career", he said. His tweet about taking Tesla private has ignited a firestorm that is still growing as the Securities and Exchange Commision has gotten involved, and investors are uncertain about the future of the deal and any potential legal action the company may face.

On August 7, Elon Musk surprised investors when he wrote on Twitter that he was considering Tesla's withdrawal at United States dollars 420 a share, or around USD 72 billion, which would be 20 percent higher compared to the price at which the company's securities were traded on that day.

But, people familiar with the search said it escalated after Mr Musk's tweets about taking the company private and the cave diver. Nearly a week later, the chief executive said the basis for that statement was conversations with Saudi Arabia's Public Investment Fund, which first expressed interest in helping take the company private in early 2017.

The New York Times said that in response to questions for its article on the interview, Tesla issued a statement from its board, excluding Musk, that stated: "We would like to make it clear that Elon's commitment and dedication to Tesla is obvious". When asked if he regretted his Twitter post, Musk replied: "Why would I?"

Musk said there were no plans for him to relinquish his dual roles as chairman and chief executive.

It is still unclear whether Musk has "secured funding", as his August 7 tweet suggests.

"It ultimately comes down to if you can afford to be private and if you can get funding, and what the cost of that funding is", said Craig Birk, chief investment officer for Personal Capital Advisors Corp, a Tesla shareholder which owned about 97,000 shares as of June 30.

The regulator is already looking into Musk's tweet saying his plan for privatisation had "funding secured", amid concerns he misled investors. "You just sit there like a stone on weed". "I've had friends come by who are really concerned". Last year, the company only made 2,700 Model 3s, compared with 20,000 predicted by Musk last year. They've fallen back but remain elevated. At the same time, it's worth noting that a key indicator of Tesla's all-important vehicle production capacity is ticking higher all the time.

The Tesla boss says he's prepared for 'at least a few months of extreme torture from the short-sellers, who are desperately pushing a narrative that will possibly result in Tesla's destruction'.

Mr Musk told the Times that board members had not complained to him about his tweet.

The interview puts board members in a hard position because Mr Musk, who entered Tesla as a major investor and built the company into a force that has changed the perception of electric cars, is the company's public identity.

Tesla's board has since clarified that it hasn't received a formal proposal from Mr Musk, nor has it concluded whether going private would be advisable or feasible. "But I was not on weed".

Tesla board members didn't respond to several requests for comment; they often forward journalists' inquiries to Tesla's communications team.