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Elon Musk Tweets About Tesla Sales, the SEC, and a Special Offer From SpaceX (marketwatch.com)
Tesla's model 3 is now one of the five top-selling sedans in America (while sales of the Mercedes-Benz C-Class are down 28 percent through September), Bloomberg reports. Elon Musk tweeted out a link to their article on Thursday -- but it was his other tweet, a satirical criticism of the SEC, that made headlines. MarketWatch reports:
Tesla shares ended 7% lower on Friday as Wall Street reacted to Musk's tweet seemingly out of nowhere late Thursday about the "Shortseller Enrichment Commission." Musk also tweeted that day that short sellers were "value destroyers" and should be illegal. Friday's losses for Tesla "produced more than half a billion in paper profit for the shorts," S3 Partners LLC, which tracks real-time short interest data, said in a note. Since news of the Musk's settlement with the SEC, shorts are up $941 million, S3 Partners said. "Clearly short positions are building in the wake of strong selling by longs, as Musk demonstrates a refusal to keep away from controversy," the note said.
The article notes that last Saturday the SEC settled charges that Musk misled investors with a tweet about taking Tesla private. "Terms of the settlement included requiring Tesla to rein in Musk's social-media communications, but it was unclear when Tesla intends to implement that.... The settlement has yet to be court-approved."
On Friday Musk was back on point, tweeting out the news that Tesla owners "can refer someone to buy a Tesla & get any image they want laser etched in glass & sent to deep space for millions of years."
The article notes that last Saturday the SEC settled charges that Musk misled investors with a tweet about taking Tesla private. "Terms of the settlement included requiring Tesla to rein in Musk's social-media communications, but it was unclear when Tesla intends to implement that.... The settlement has yet to be court-approved."
On Friday Musk was back on point, tweeting out the news that Tesla owners "can refer someone to buy a Tesla & get any image they want laser etched in glass & sent to deep space for millions of years."
Itâ(TM)s a thin line.
Of course, a lot of that threshold is crossed not that much by him but by the public perception, but the overall effects will be indistinguishable in the long run. I hope he manages to claw back on this. Because it would really be a pity if not.
Now we gotta have news stories on the front page about ANOTHER jackoff's tweets? You know, for a group of nerds who are supposedly above the plebian social media, we sure do hear a lot about tweets around here.
I thought this was a tech site and not just another outlet for billionaires' bullshit.
You are welcome on my lawn.
What people forget is that before the '420 tweet' investigation was announced, there was already an open investigation into Musk's Model 3 production promises. And don't forget the DoJ has an open investigation. If the issues with the feds were settled then why the rant and why now hire a law firm that specializes in defending its clients from fraud? https://www.bloomberg.com/news...
The government was quite happy yo go to court, they *agreed* to this as part of a settlement. Said agreement is still under scrutiny by the court for being too lenient.
The Model 3 "sales" metric right now is actually how many he's able to produce to satisfy purchasing decisions people made a long time ago, not how many people went out and made a purchasing decision today.
I don't see how the head-to-head comparison against current sales data of other cars could be meaningful without knowing whether the Model 3 waiting list is growing, shrinking, or staying about the same.
Shorting inherently reduces the stock value. Hence, your argument is that the stock value has no effect on a company's operations. But this is obviously false; many things related to a company's ability to raise capital or obligations related to existing debt are tied to the company's stock price. Hence, shorting a stock inherently - on its own - hinders a company's finances.
Beyond this, however, shorting a company creates a strong incentive toward spreading FUD against a company. Indeed, this is the entire means by which "activist short sellers" such as Jim Chanos and Andrew Left operate. Activist short sellers coordinate their short positions with a negative PR campaigns against their targets. These can range from the aboveboard, such as interviews, to the nefarious, such as paying off "independent" analysts to write negative reports (such as what Chanos got caught doing in his Fairfax campaign), to the amateur, like the regular astroturfing campaigns we get on the Tesla forums.
When faced with an activist short campaign, companies have a few options. One is privatization. We saw how that went re: Tesla. The other is to decrease the company's dependence on outside capital, and thus decrease the significance of its stock price on the company's operations and to raise its credit score. While this is an effective strategy, it strongly hinders the company's growth rate. A company fighting off a short campaign in this manner has to heavily cut back on its least profitable activities and its investments in the future and instead focus only on its most profitable activities.
As for the rest of your post:
"Tesla is losing money": "Is" is a present tense verb. Meaning past Q3. We have not seen the Q3 report yet. The goal was to become sustainably profitable in Q3. We'll know in four weeks if it was a hit or a near miss.
"is buried in debt beyond a healthy level": Tesla's debt-to-equity ratio is 60% that of Ford's. I know some people will argue that, "Well, with the traditional automakers you shouldn't count their financing divisions, as they're profit-makers!". But their financial divisions are an essential part of their operations. When comparing companies, you compare all of their components, not just the fractions you want to. And more to the point, the traditional automakers' debt is a lot more risky than Tesla's. Defaulting on auto loans is one of the first things that happens during a financial downturn.
"Of course anyone pointing out those facts are called "trolls" or "shorts". Which he then bullies along with his cult following those people"": Irony alert: Sentence 1: Stop name calling! Sentence 2: Practice name calling!
What he did to that analyst during that conference call: Which analyst? One asked a question that was literally answered right at the top of the Q1 report that everyone was supposed to have read before joining the call. Boldfaced. By re-asking Tesla about that, he was basically accusing them of lying. The other was pushing a conspiracy theory that Tesla's demand was running out. It's five months later and it still hasn't happened, so clearly it was a boneheaded question.
" and to the blogger Montana Skeptic was just pure asshole.": Meh. Musk knew his boss. His boss was an early supporter and fan of Tesla.
"And when you add in the fact that CFOs don't stay": Tesla's CFO has been with the company since 2008.
"Also remember that Model S sales have tanked": They clearly have not, as per the delivery report. They increased over last quarter, and are well on their way to Tesla's max annual 100k S+X production capacity.
"I have a sneaky suspicion that Q3 isn't going to be that good" - Please mortgage your house and short the company, since you both hate Tesla and love short selling.
"Close the door! What, were you born in a barn?" -- Police chief, "Jesus Christ Supercop"
Both preorders and new orders, but only for a small subset: US and Canada only, LR, PUP, non-lease, no air suspension, no tow package. Tesla is preparing for both their European launch and production of a broader range of options shortly. Pre-orders have priority, but only for within their config and market.
Sedans come before crossovers because they require less batteries for the same range. So long as you can sell as many as you can make, that's what you want first. Whenever you become demand limited, rather than supply limited, that's when you focus on crossovers.
"Close the door! What, were you born in a barn?" -- Police chief, "Jesus Christ Supercop"
When you short a stock, you take a share that wasn't available for sale, and make it available for sale. You increase the supply on the market. The laws of supply and demand dictate a price drop. When you cover, you take a share that was available for sale and take it off the market. You decrease the supply on the market. This correspondingly dictates a price rise.
"Close the door! What, were you born in a barn?" -- Police chief, "Jesus Christ Supercop"
26150 S+X Q3 last year vs. 27660 S+X Q3 this year, you mean? Not like it matters. Tesla has the battery supply to make about ~100k S+X per year. Doesn't matter what quarter they move them, that's their cap.
Be sure not to cover before the Q3 report ;)
Simple, readily cross-referencable facts are bullshit. Got it.
Did you see what the stock did after the Q1 call?
Did you see what the stock did after the Q2 call?
Would you apologize for billions of dollars?
"Close the door! What, were you born in a barn?" -- Police chief, "Jesus Christ Supercop"
And nope, shorting does not involve imaginary stock. A short itself is a contract to sell stock to somebody at a particular price on a particular date. It's basically an IOU to the person buying it. When that date arrives, stock is purchased from the open market and given to the buyer. The hope for the short trader is sell it for more in the contract than its worth on the open market on the date the short matures.