Elon Musk is in trouble again, having once again exposed himself on Twitter as a major tech entrepreneur unable to keep key company information to himself.
On 20 February he tweeted: “Tesla made 0 cars in 2011, but will make around 500k in 2019.”
He added about four hours later: “Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.”
Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.
— Elon Musk (@elonmusk) February 20, 2019
But the damage had been done.
The Securities and Exchange Commission, SEC, the watchdog over US stock market regulation, took Musk to court.
It claimed he had violated the $40m settlement reached over his previous tweets in August 2018 about taking Tesla, his electric car company, private.
The agreement said that Musk would need approval from a company lawyer for any tweets that could influence investors, which Musk appeared to have failed to get for the tweets in question.
SEC files for violation
According to Reuters, SEC filed a motion on 25 February in Manhattan that said: “Musk has thus violated the court’s final judgment by engaging in the very conduct that the pre-approval provision of the final judgment was designed to prevent.”
The burden was on Musk to explain why he should not be held in contempt for violation of the earlier settlement.
He claimed the production numbers came from an analysts’ call, from information that had been disclosed in January.
The exact comment Musk made in this call was that Tesla would make “maybe on the order of 350,000 to 500,000 Model 3s, something like that this year”, says Reuters.
Musk still has the confidence of his employees
However, Musk hasn’t lost popularity among his staff in spite of all the press.
Anonymous workplace social network Blind asked 1,400 Tesla and 250 SpaceX employees to answer true or false to the statement: “I am confident in Elon Musk’s ability to lead the company.”
The survey ran for a week from 14 to 21 February, and 77.8% of the 284 people who took part, said yes, confirming they were still confident in their boss.
Less than a quarter of Musk’s employees felt it was a false statement, which would indicate a loss of faith in his leadership.
“Business as usual” for Musk
In October 2018, SEC pushed Musk out of the chair at Tesla and into the post of chief executive officer, but some believed he would remain the figurehead.
PR, social media and marketing consultant Mike Driehorst said: “From a public relations/public perception point of view, the US SEC penalty on Elon Musk and Tesla is nothing more than a slap on the wrist.
“Yes, a $20m fine for Mr Musk sounds like a big deal but, in the big picture, it’s really nothing more than a nuisance.
“Mr Musk still retains his CEO title at Tesla. Therefore, he’s still the face and the driving force behind the company.”
Driehorst predicted that: “He’ll still tweet with nearly reckless abandon, drive his managers and employees, and we’ll still hear tales of Mr Musk sleeping in the factory.
“The net effect on Mr Musk and Tesla is nothing. It’s business as usual.”