Tesla, Inc. (NASDAQ:TSLA) has created some of the most innovative bits of technology in our time, with a heavy focus on alternative energy sources. The main issue with the company is that they are burning cash and falling short on production targets due to issues with manufacturing. Another key issue may also be the behavior of the CEO, Elon Musk, who in recent months has spouted off on an investor, slept on the floor of his production factory, and smoked marijuana with comedian Joe Rogan.
The well-known electric-car company’s CEO, Elon Musk, took to Twitter last month to say he’s thinking about taking Tesla private at $420 a share. That tweet was later followed up by another one by Musk saying, “funding secured.”
Musk backed up his claims by saying the Saudi Arabian sovereign wealth fund has brought up taking the company private multiple times and felt positive about his July 31st meeting with the fund’s managing director.
Since then, Musk has made a complete U-turn on his plan citing that investor support is not there as they believe going private is not a sound option. Musk tweeted later that the “sentiment, in a nutshell, was ‘please don’t do this’.”
Musk’s recent claims and tweets have gotten him in a bit of trouble, prompting an investigation from both the Department of Justice and Securities and Exchange Commission.
Right now, the SEC have subpoenaed the directors of Tesla to learn more about what they may have known about the CEO’s sporadic plan to take the company private. The SEC is actively investigating Model 3 production claims from back in 2017 which the company completely under-delivered on.
The Department of Justice also just launched a probe following Musk’s tweets about taking Tesla private.
It seems that a lot of these issues that are rising with the company can be drawn back to the current CEO. Based off his current behavior, Musk would fit much better in a CTO position while allowing someone with more experience in automotive production to step into the CEO role.
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