Tesla shares increase after SEC lawsuit leaves Musk as CEO

Tesla shares rebounded after last week's US lawsuit over private tweets on the sale of Elon Musk, while a settlement guaranteed that the billionaire would continue to pull the strings of the automaker, which he says is about to become profitable.

Under the agreement with the Securities and Exchange Commission, Musk and the company will each pay a fine of $ 20 million, and Musk will not be able to be president for at least three years. The agency gave up on sending him back as CEO.

Tesla jumped 17% to $ 309.99 early Monday, which is more than enough to offset the 14% fall on Friday. The shares closed at $ 307.52 on Thursday, before the SEC announced its coercive action on tweets, in which Musk said it had "guaranteed funds" to take the private company to $ 420 per share. He subsequently abandoned the plan to pursue a buyout.

Investors now want to see if Tesla has achieved its production and delivery targets. A first exploit or failure verdict could land on Monday in the form of Tesla's latest quarterly publication. Musk, 47, told his employees Sunday that the company was "very close to achieving profitability and proving that the opposition was wrong," but that it still had to run on the last day of business. quarter.

Tesla is now valued at about $ 51.8 billion on the stock market, taking back the title of the first US automaker to market capitalization of General Motors Co. Shareholders are betting that the company is on the cusp of reducing losses and Model 3 sedan cash consumption.

The short sellers targeted the company, claiming that it had to raise billions of dollars more in funding, that it was subject to a poor quality control and that it was headed by an erratic CEO. .

Tesla's most active high yield bond issue rose Monday, up 2.5 cents to 86.75 cents on the dollar, the largest increase since August 2.

Army of volunteers

An army of volunteer Tesla owners flocked over the weekend to help deliver cars to new buyers. Musk applauded his employees, telling them in e-mails to "ignore all the distractions" and that they were about to "win an unparalleled epic victory."

In the suburbs of Chicago's Highland Park, more than 75 people crowded into Tesla's service center and some fifty others waited outside. In the community of Marina del Rey in Los Angeles, many customers arrived as semi-trailers arrived to unload the vehicles stored in Burbank. In Coral Gables, Florida, a showroom clerk who asked not to be named said that deliveries were scheduled hourly to avoid traffic jams.

It was not immediately clear how many outlets in the US were at record levels. The one in Brooklyn, for example, was silent on Saturday morning. The Tesla showroom in Paramus, New Jersey, was closed at 8 pm local time Sunday.

Work periods

Others were so busy that volunteers came forward to help the staff. Andrew Doane, who owns an S-model sedan, a crossover vehicle and a Model 3 vehicle and is president of the Tesla Owners Club of the Central Atlantic Coast region, asked club members to work in teams in distribution centers in Virginia and Maryland. .

"This weekend is the pivot point," he said, describing it as a turning point, not only for the company, but also for the abandonment of the internal combustion engine.

After having repeatedly fallen short of its manufacturing targets, Tesla probably produced about 53,457 models 3 in the third quarter, according to a Bloomberg tracking tool that uses vehicle identification numbers and other inputs to estimate production in real time. That's above the Wall Street consensus of 50,416 – the average estimate of five analysts surveyed by Bloomberg – and up the forecast of 50,000 to 55,000 models 3 of Musk in July.

Legal battle

After the filing of the complaint, SEC officials anticipated a protracted legal battle, but settlement negotiations resumed on Friday after Musk's lawyer, Steven Farina, sent a courier asking to reopen the discussions.

Stephanie Avakian and Steve Peikin, co-directors of the SEC's Law Enforcement Division, led the talks, taking the reins of the lawyers who worked on the case, according to two people close to the case.

Avakian and Peikin demanded that Musk pay $ 20 million and be removed from his position as chairman of the board of Tesla for at least three years, conditions harder than those proposed in the discarded agreement, said people at current. The agency also demanded that the company pay $ 20 million in fines to settle separate claims related to Musk's use of social media.