Home News Elon Musk on taking Tesla private: ‘That ship has sailed’

Elon Musk on taking Tesla private: ‘That ship has sailed’

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Elon Musk would prefer if Tesla, which is famous for its volatile share price and is one of the most heavily shorted stock, were a private firm, but acknowledged during an earnings call Wednesday that it wasn’t likely.

Musk can dream, can’t he?

“Unfortunately that ship had sailed,” Musk said in response to a query from Morgan Stanley analyst Adam Jonas.

Musk said Tesla was a distraction occasionally and then added, “I’m not sure what to do about it. ”

The question came up as an increasing number of investors wager that Tesla’s stock will decline. The stock is one of the largest automotive shorts worldwide, according to S3 Partners.

Taking the company private, a status in which Musk’s other firm SpaceX stays, is a sore spot for the billionaire entrepreneur. And one that disrupted the stock price and has caused woes.

Musk famously tweeted in August 2018 he was considering taking Tesla private and’d “funding secured. Tesla printed an email Musk delivered to employees that described his rationale, only to back track a few weeks later and announce the firm would remain public. That tweet got the attention of the U.S. Securities and Exchange Commission, which later accused Musk of securities fraud. Without admitting wrongdoing, the parties reached a settlement.

Under the settlement, Tesla agreed to include two directors and Musk would step down as chairman for three decades. In December, Tesla added two independent directors to its board — Oracle founder, chairman and CTO Larry Ellison and Walgreens executive Kathleen Wilson-Thompson.

Regardless of the settlement, the connection between Musk and the SEC remains strained. The agency asked a judge hold Musk in contempt for tweets containing allegedly material information. Musk and the SEC is expected to report to the judge Thursday as to whether they have reached a resolution.

Tesla reported Wednesday wider-than-expected reduction of $702 million, or $4.10 a share, in the first quarter following disappointing delivery numbers, costs and pricing adjustments to its vehicles threw the automaker from its profitability track.

While analysts had anticipated a reduction — an adjusted loss of $1.15 a share on sales of $5.4 billion for the quarter, according to FactSet — actual losses stretched far beyond these expectations.

The loss included $188 million of charges. When corrected for one-time reductions, Tesla lost $494 million, or $2.90 a share, compared with a loss of $3.35 a share a year ago. Tesla reported that it incurred $67 million due to a combination of restructuring and other charges.

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