Investor's Corner

Elon Musk’s Twitter tirade comes amid SEC probe on Tesla’s Model 3 production ramp

Published

7 years ago

October 6, 2018

Simon Alvarez

Tesla shares (NASDAQ:TSLA) experienced a steep dive on Friday’s trading, dropping more than 7% amidst reports that U.S. District Court Judge Alison Nathan has asked Elon Musk and the Securities and Exchange Commission to justify the terms of their settlement over the CEO’s “funding secured” lawsuit. Also weighing down Tesla’s stock was Elon Musk’s latest Twitter session, where he seemingly trolled the SEC by dubbing the agency as the “Shortseller Enrichment Commission,” and then doubling down.

Update: Tesla CEO Elon Musk faces contempt claim from SEC over recent tweets

Musk’s latest round of tweets has polarized the Tesla community, as a number of retail investors began directly addressing their concerns to the CEO regarding his behavior and its effects on the price of TSLA stock. While Musk assured the community that they would be fine if they are invested for the long-term, several retail investors nonetheless informed the CEO that they had lost a considerable amount of money due to the apparent market-moving effects of his tweets.

But what’s the point of poking regulators publicly? The greatest problem is sustainable energy as you said, but every distraction erodes goodwill you worked so hard to build.
— Vicente Silveira (@vicentes) October 5, 2018

Just want to that the Shortseller Enrichment Commission is doing incredible work. And the name change is so on point!
— Elon Musk (@elonmusk) October 4, 2018

While the reasons behind Elon Musk’s latest Twitter session are still up for question, some details about the CEO’s aggravation over the SEC appear to have been teased by FBN’s Charlie Gasparino. In a segment on Fox Business, Gasparino noted that sources close to Tesla’s legal team and the SEC had informed him that the agency is still investigating Tesla, not because of Elon Musk’s “funding secured” tweet, but over the company’s previous forecasts on the Model 3 production ramp and and the company’s profitability.

“What we reported was from people close to the Tesla legal team and the Elon Musk legal team. What they’re telling us is that the SEC does continue to investigate Tesla. Remember, the “funding secured” thing is out of the way, but there’s an existing investigation that could take a bit longer. It involves Tesla and Elon Musk’s stated production goals for the Model 3 largely, and profitability; if those things match up to reality, and whether there’s a fraud case by saying ‘Hey, we’re gonna reach profitability, for example.’”

“The case focuses again on targets that Musk made and some of the other corporate executives as well, about when the Model 3 was gonna come out, how many were gonna be produced, and profitability. When Tesla was gonna be profitable. Remember, these goals have changed along the way. He’s now saying the third quarter should be profitable. We’ll see if it happens.”

Gasparino noted that the SEC’s investigation into Tesla’s Model 3 production and profitability goals would likely be more challenging for the agency than its “funding secured” lawsuit against the CEO. In order to corner Musk and Tesla, the SEC would have to prove that the company knowingly misled investors about the Model 3 ramp. If Tesla or Elon Musk admits that it has honestly miscalculated the progress of the Model 3 ramp, the SEC would likely have a difficult time proving its case. Gasparino noted that his sources in the SEC had informed him that this other Tesla investigation would likely be a very “tough” venture for the agency.

“This is a much tougher case. While it still exists, it’s still problematic for the company; it’s a much tougher case than the other one. This is something that you literally have to go back, look at his statements, look at potential emails where they might be telling each other ‘Hey, we know this is BS, we’re just throwing it out there.’ That’s what the SEC is looking at. So this is a much tougher case, and that’s why the market looks like it’s coming off its lows on this, because people are saying ‘Maybe they got done with the other case, and that’s about it.’”

“This is where we are right now. We should point out that cases like this take months. They’re tough to prove. Very hard to prove that someone was specifically lying about a production goal. You could say “Listen, I thought we’re gonna produce that many Model 3, I thought we were gonna hit production profitability in the second quarter. I was wrong, I misinterpreted.” That type of honest mistake, even though I think most CEOs know you shouldn’t say that sort of stuff. You try not to get forward-looking statements; you always run into problems. That is a tougher case then ‘funding secured,’ and you don’t have funding secured.

“I think if you’re betting that he might be, from a regulatory standpoint, largely out of the woods. I’m not saying he is. If you’re betting, I’m just saying these are tougher, tougher cases. And I can tell you, my sources inside the SEC are telling me that.”

There is no denying that Elon Musk’s Twitter twitter behavior has resulted in losses for Tesla’s investors once more. By the time markets closed on Friday, Tesla stock had lost the recovery it gained earlier in the week after the release of its impressive Q3 production and delivery numbers, as well as the announcement of Elon Musk and the SEC’s settlement. In this sense, Elon Musk’s decision to poke the agency seems like a miscalculation at best.

That said, if the seasoned journalist’s sources are correct and the SEC is still pursuing Tesla over its Model 3 goals, at a time when production of the electric sedan is hitting its stride and the vehicle is getting warmly received by consumers, then Elon Musk’s aggravation becomes a bit more understandable. Nevertheless, with millions in the Tesla community investing their hard-earned money to support the company, then it seems safe to say that Elon Musk should have known better.

Watch Charlie Gasparino’s segment on Fox Business in the video below.

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Simon Alvarez

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Investor's Corner

Deutsche Bank boosts Tesla (TSLA) stake by 20.8% to over $2.6 billion

The German banking giant now owns 10,076,461 Tesla shares.

Published

12 hours ago

August 13, 2025

Simon Alvarez

Credit: Tesla China

Deutsche Bank AG has significantly increased its position in Tesla (NASDAQ: TSLA), boosting its stake by 20.8% in the first quarter.

The German banking giant now owns 10,076,461 Tesla shares, an additional 1,733,531 shares compared to the previous quarter, valued at roughly $2.61 billion.

A top holding

As noted in a report from MarketBeat, Tesla now represents about 1% of Deutsche Bank’s overall investment portfolio, making it the firm’s 13th-largest holding. This also means that Deutsche Bank now owns 0.31% of the electric vehicle maker, at least as of its most recent SEC filing.

Tesla shares are typically volatile, and they are still being traded actively, with an average trading volume of 104.7 million. As of writing, Tesla has a market capitalization of around $1.11 trillion, making it the biggest automaker in the world by far.

REPORT SAYS: Deutsche Bank has boosted its stake in Tesla by 20.8% in Q1, now holding over 10 million shares worth roughly $2.61 billion, making it the bank’s 13th largest holding.

Tesla stock has been trading actively, with over 66 million shares exchanged and a $1.04 trillion…— Muskonomy (@muskonomy) August 13, 2025

Institutional investors

Deutsche Bank is not the only firm that has been increasing its stake in TSLA. Charles Schwab Investment Management raised its Tesla holdings by 4.9% in Q1, resulting in the firm now controlling over 18.17 million shares worth $4.71 billion. Evolution Wealth Advisors also increased its Tesla stake by 85.7% to over 13,000 shares.

Overall, institutional support for Tesla remains robust, with 66.2% of the company’s stock held by hedge funds and other large investors.

TSLA stock has been seeing some momentum as of late, amidst reports that the electric vehicle maker is making progress in several of its key initiatives. Tesla’s Robotaxi business in Austin and the Bay Area is expanding well, and Elon Musk recently announced that FSD V14 should be released soon to consumers. Tesla China is also expected to launch the Model Y L, a six-seat extended wheelbase version of its best-selling car, before the end of the third quarter.

Elon Musk

Elon Musk’s new $29B Tesla stock award gets strange synopsis from governance firm

Did CGI not realize that Tesla Shareholders supported Musk being paid not once, but twice?

Published

1 day ago

August 12, 2025

Joey Klender

Credit: TED

Elon Musk was recently awarded around $29 billion in Tesla stock as the company’s Board of Directors is attempting to get its CEO paid after his original pay package was denied twice by the Delaware Chancery Court.

But a new and strange synopsis from the Corporate Governance Institute (CGI) says the award is potentially a strength move to “endorse the will of a powerful CEO.” The problem is, in the same sentence, the firm said the new award brings up a “question of whether the board exists to steward a company in the interests of all stakeholders.”

The problem with their new analysis of Musk’s pay package is that shareholders voted twice on Musk’s original pay package of $56 billion. They voted to give Musk that sum on two separate occasions.

Musk’s original $56 billion pay package was approved by shareholders twice; once in 2018 and once again last year. Last year’s vote was in response to Delaware Chancery Court Kathaleen McCormick’s decision to revoke the “unfathomable sum” from Musk.

Shareholders still showed support for Musk getting paid. Tesla said in its new award to the CEO that this is a way to give him compensation for the first time in seven years.

CGI said in its note (via TipRanks):

“When a board builds its strategy around a single individual, it creates a concentration risk, not just operationally, but culturally and ethically. If that individual becomes a source of volatility, the company becomes fragile by design.”

What’s strange with this type of narrative is the fact that Tesla’s valuation has skyrocketed with Musk at the helm. Go back to 2020, and the stock is up over 200 percent. Since Musk’s $56 billion pay package was introduced in 2018, shares are up well over 1,000 percent.

Tesla engineer explains why Elon Musk deserves new pay package

Musk’s 2018 pay package was also not awarded to him without performance-based incentives. He was required to reach certain growth goals, all of which were accomplished through the launch of new vehicles and the advancements of its driver-assistance suites, like Autopilot and Full Self-Driving.

It is tough to agree with CGI’s perception of Musk’s new pay plan, especially as it is much less than what shareholders voted on twice. Musk deserves to be paid for his contributions to Tesla.

Investor's Corner

Tesla gets its best analysis from Morgan Stanley as ‘it’s all about to change’

He maintained its ‘Overweight’ rating and the $410 price target Morgan Stanley had on the stock.

Published

6 days ago

August 7, 2025

Joey Klender

(Credit: Tesla)

Tesla has gotten perhaps its best analysis from Morgan Stanley in quite some time, as the Wall Street firm claims that “it’s all about to change.”

That phrase could be used for both the company’s status and the world in general.

Analyst Adam Jonas said in a new note on Thursday to investors that Tesla could be one of the major winners in terms of the global transition from what it is now to what it will be.

He describes the global shift that will occur over the next few years:

“Have you interacted with a robot today? Have you even seen a robot today? No? Well, take a mental picture because it’s all about to change. When we meet someone who has never been in a Waymo or a Tesla Cybercab (which is most people), we frequently see a wince and a response such as ‘I’m not sure I’d feel comfortable getting in a car without a driver.’ We imagine going back in time to 1903 and asking people if they’d feel comfortable in an airplane.'”

The same technological revolutions that have occurred over the past 150 years will continue to occur again and again. We are on the verge of another, Jonas believes, as companies like Tesla are working on artificial intelligence tech, which includes changing the way we look at things like transportation and labor.

Jonas includes an interesting tidbit in his note about how humanoid robots could change wages, and how it could work into the advantage of Tesla, especially as it is developing its own Optimus robot:

“We estimate 1 humanoid robot at $5/hour can do the work of 2 humans at $25/hour, generating an NPV of approximately $200k/humanoid. 1 robot shaped car can potentially drive down cost/mile of a ride share vehicle to <$0.20 mile (1/10th human-driven ride-share).”

Jonas sees Tesla as a key player in how AI will impact things like manufacturing and various automotive industries, and he believes there is long-term potential for AI, robomobility, and even autonomous eVTOL platforms.