Cooking in Hot Water, Tesla (NASDAQ:TSLA) ‘Bad Boy’ Elon Musk, 47 anni, posted another Tesla Inc. production forecast like of the 1 that landed him before a federal judge earlier this month.
Late Sunday, Mr. Musk Twetted that Tesla will make more than 500,000 cars in the next 12 months. A similar Tweet sent nearly 2 months ago in which Mr. Musk said the company would build 500,000 vehicles in Y 2019 led the SEC to argue he was in contempt of a settlement reached with the regulator last year.
The latest forecast, given as a seemingly innocuous aside in a discussion about the future value of Tesla EV, nonetheless came as Mr. Musk’s lawyers are negotiating with the SEC over an agreement that put controls on the company CEO’s Tweeting. A US judge gave the 2 sides until 18 April to meet for at least an hour and resolve their differences. If they cannot she will rule whether or not Mr. Musk is in contempt.
The legal dust-up for Mr. Musk served as a distraction amid a record decline in deliveries for Tesla during Q-1. Concerns about demand for Tesla’s vehicles escalated last week after the Nikkei reported the company and its partner Panasonic Corp. is freezing plans to expand capacity at the battery factory they share in Nevada.
Saturday, Mr. Musk disputed reports that Panasonic had boosted annualized battery cell production capacity at the plant to 35 gigawatt hours, saying the company’s lines were only at 24 gigawatt hours and have been constraining output of Tesla’s M-3 sedan, that appears not to be the case, as demand for the company’s EVs is fading.
Both the Panasonic and the next-12-months production Tweets are noteworthy in light of the settlement that sprang from Mr. Musk Tweeting in August of last year about trying to take Tesla private in the notorious 420 transaction.
There the SEC accused COB/CEO Musk of securities fraud, and he settled agreeing to pay $20-M, step down as chairman and seek pre-approval from an in-house securities lawyer before Tweeting any material information about the fledgling EV maker.
Mr. Musk’s legal team argued that he retained discretion to determine whether he was sending out material information or not, and that his 19 February post about Tesla’s Y 2019 production was consistent with comments he made weeks earlier on an earnings call.
In a 4 April hearing where Mr. Musk appeared, US District Judge Alison Nathan questioned the specifics of the CEO’s settlement with the SEC and told the 2 sides to rework the language of their agreement.
“Take a deep breath, put your reasonableness pants on and work this out,” Judge Nathan said.
She wrote in an order the next day that if Mr. Musk is held in contempt, the court will allow further briefings on sanctions.
The SEC said at the hearing that the remedies it was seeking included a series of escalating fines for future violations, and monthly reporting on all of Mr. Musk’s communications.
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