‘Pedo,’ ‘Private’ and ‘Pravda’: How Elon Musk’s Twitter Posts Are Trouble for Tesla
Elon Musk has a lot going on at Tesla. As he attempts to change the course of car manufacturing history, he is also seemingly trying to change the laws of time and physics: There may not be enough time left to ramp up production of the Model 3—the car that was supposed to take Tesla to profitability. Analyst Jed Dorsheimer at Cannacord said Tuesday on CNBC that the firm has about six to nine months left to reach profitability to remain solvent.
In the midst of this—while sleeping at the office, working sometimes more than 24 hours a day and often logging 120 hours a week—Musk still somehow seems to find time to post messages on Twitter. Lots of them. Unvetted by his board, Tesla’s legal department, or by the public-relations team, these Twitter posts run the gamut from dad jokes to the terrible habit of replying to Tesla’s supporters and critics.
Musk’s Twitter habit has led to not just anger, misunderstandings, and demands for apologies, but also to investigations by government bodies. While Tesla may need his attention more than full-time, it’s getting less than that—and that’s only accounting for his other company, SpaceX, and his side ventures of building super-fast train tunnels, shipping flamethrowers, and even making candy.
As Tesla burns cash, Musk tweets. And tweets. And tweets. His board has urged him to stop. But on he goes. These Musk tweets are some of his all-time most distracting from Tesla’s business at hand.
Union busting in a tweet
Last week, in response to a May 20 tweet by Musk, the National Labor Relations Board (NLRB) filed the latest in a series of complaints about Tesla, according to Jalopnik after Musk suggested in response to a question about unions that workers would pay dues and “give up stock options.”
The NLRB complaint says that Musk’s comment could be construed as interfering with the rights of employees to freely decided whether or not to join a union. The United Auto Workers (UAW) filed its own complaint with the board shortly after the tweet.
Tesla said that the tweet reflected the fact that it was unaware of any UAW-represented production autoworkers who receive restricted stock units (grants of stock with conditions on selling) or stock options (the right to buy stock at a given price).
“Sorry pedo guy”
When a soccer team of 12 kids and their coach became trapped in a cave system in Thailand in July, Musk not just offered an experimental mini-submarine, but took time out of a critical point in Tesla’s production to deliver it himself—though it went unused. After one of the rescuers, British expat Vernon Unsworth, called Musk’s move a PR stunt and said “He can stick his submarine where it hurts,” Musk labeled him “pedo guy,” meaning he was a pedophile. He implied that was the only reason for a Brit to live in Thailand.
Musk deleted the tweets shortly after, and apologized on July 18, stating that his words were spoken in anger.
But on Tuesday, Musk rejected the notion he’d cried during what the New York Times described as an emotional interview. When challenged, the Tesla founder effectively reiterated his previous suspicions about Unsworth, rhetorically noting that “it’s strange he hasn’t sued me?”
Unsworth’s attorney, Lin Wood, replied to Musk that he “should check his mail,” and reproduced a letter stating he was preparing a libel suit that he indicated was sent via Fedex and email on August 6 to Musk’s Los Angeles address.
A few days later, Musk threw this all out the window in emails to Buzzfeed News, in which—labeling his email “off the record” and “on background” without advance agreement with Buzzfeed—he repeated and elaborated on pedophilia allegations, and said Unsworth was shunned by the rescue crew and not present when Musk visited. Musk’s attorney and several other members of the rescue group denied Musk’s statements.
“$420. Funding secured”
Out of the blue, Musk tweeted on August 7—while stock markets remained open—that he was considering taking Tesla private at $420 a share and that he’d secured funding. The Tesla board was unaware. This moved Tesla stock upward by 6%, closing at $362.
Musk told the New York Times in a story that appeared August 16 that no one at Tesla reviewed his tweet before he posted it. He also said the post’s apparent drug joke—420 is a reference to marijuana—was unintentional, a matter of rounding up a price premium he’d set of $419 to the next whole dollar. ‘I was not on weed, to be clear,’ he told the Times.
Musk also revealed not long after the tweet that he, in fact, didn’t have funding lined up, but he had had conversations with Saudi Arabia’s sovereign wealth fund.
Just weeks later, on August 27, Musk dropped the plan. The Securities and Exchange Commission is investigating his statements, according to reports. Should the SEC determine that Musk committed intentional fraud or was reckless in what he said, it could prohibit him from serving as a director of a publicly traded company, like Tesla.
Tesla stock has since declined in fits and starts, often preceded by a Musk tweet, to just under $305 at the close of Wednesday’s regular trading. That’s still well above its price in the recent past, but 20% off its peak.
The Pravda posts
Following a number of investigative reports about Tesla’s factory safety and other matters, Musk tweeted in May that he was going to create a site that would allow anyone to vote on the “core truth” of news stories, and use that to create a credibility score tracked over time for journalists, editors, and publications.
He suggested he’d call it “Pravda,” the name of the leading government-controlled newspaper in Soviet Russia. The Russian word means “truth.”
This post didn’t come out of nowhere. A company called Pravda Corp. was certified as a foreign corporation in Delaware in October 2017, with an officer affiliated with other Musk businesses. Musk confirmed to Gizmodo his connection, and that he’d start work after he was done working on the Model 3.
Musk has also previously tweeted that he’d start a candy company to compete with Warren Buffett’s See’s Candies (likely a joke) and a “comedy project” to take on The Onion—possibly serious, as he’d hired some Onion staffers.
Of course the argument can be made that Musk’s Twitter posts provide priceless publicity and help him craft his companies’ images without spending a dime. Who can forget Spaceman, after all? But with all the controversy that accompanies these posts, board members must be wondering, what Musk’s tweets truly costing Tesla?