Once Again, Elon Musk Said Something That Could Get Him in Trouble

Monday, April 12, 2021 | Entrepreneur


Tesla CEO Elon Musk may be on the hook for making several head-turning comments during a Jan. 27 conference call, AP reports. 

The billionaire businessman was on a call with bank analysts to discuss Tesla's fourth-quarter earnings when he allegedly misled them about the company's vehicle production. According to the news wire, Musk said that Tesla would manufacture new versions of the S sedan and X large SUV while adding that a “Plaid” high-performance version of the electric S would be available in February.

Related: Elon Musk's Neuralink Releases Incredible Video of a Monkey Playing Video Games With Its Mind

According to delivery and production figures that were released last week, however, Tesla did not, in fact, produce new versions of either model between January and March. The company instead produced 180,000 vehicles of other models, namely the 3 small sedan and the Y small SUV. 

Experts told AP that the disparity could draw the attention of the SEC, which already has a history with Musk. 

"I think he might have himself into a bit of trouble with the SEC," Anthony Sabino, an attorney and law professor at St. John’s University, said. “These are fairly direct statements. They are fairly unequivocal.”

John C. Coffee Jr., a Columbia University professor and an expert on securities law and corporate governance, told AP that Musk's comments came across as statements of fact, which could warrant an inquiry. Tesla, however, could argue that Musk was simply making a prediction during the call, Coffee added. 

Regardless, Musk's comments appeared to have little impact on Tesla's stock at the time, AP notes. A day after the call, the company's share price fell 3%. 

Musk previously ran into legal trouble in 2018, after he addressed the possible unionization of Tesla employees in a tweet. Last month, the SEC ordered him to delete the post and demanded that Tesla rehire a union organizer it had fired. Though he didn't address the ruling publicly, the business tycoon also appeared to dip his toes in dangerous waters after suggesting that Tesla could be bigger than Apple in "a few months."

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7 Hotel Stocks Just Waiting For the Vaccine

Like any group of stocks related to travel and tourism, hotel stocks saw a steep drop in share prices in 2020. The leisure and hospitality sector that once had 15 million employees has lost 4 million jobs since February.

Many major cities will be feeling the ripple effects of the Covid-19 pandemic for years. However, there is ample evidence that shows the pandemic may be coming to an end. The number of new cases is dropping. The number of those getting vaccinated is rising. And even in the cities with the most restrictive mitigation measures, the slow process of reopening is beginning.

All of this can’t come fast enough for individuals who rely on the travel and tourism industry for their livelihood. Hotel chains had at least some revenue coming in the door. And when earnings season concludes, the more budget-friendly hotel chains may realize revenue that is 75% of its 2019 numbers. But that is not enough to bring the hotels to anywhere near full employment. Particularly with hotels that have bars and restaurants that have remained closed or open at limited capacity.

Many economists are optimistic that travel may begin to look more normal by the summer of this year. And the global economy may deliver 6.4% GDP growth this year. With that in mind, the hotel chains with the best fundamentals and the broadest footprint will be in the best position as the economy reopens.

View the "7 Hotel Stocks Just Waiting For the Vaccine".


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