Elon Musk: Top controversies of 2018

Elon Musk: Top controversies of 2018

Elon Musk has had an interesting year and has by no means kept his distance from the headlines.

With the help of Twitter, the chief executive of Tesla (NASDAQ: TSLA) has sparked controversies that have resulted in lawsuits, fines, stock price dips and most recently, had him resign as chairman.

The tech billionaire is erratic, hardworking and outspoken. Has his newsworthy presence over the year been welcome or, as University of Michigan business professor Erik Gordon says, had Musk “gone from looking like the visionary genius to looking like the out-of-control guy who probably is on the borderline of a breakdown.”

Bonehead Analysts 

In May of this year during Tesla’s latest earnings call, Musk got bored of analyst questions yet instead of carrying on answering, simply replied:

“Boring bonehead questions are not cool. Next. We’re going to go to YouTube. Sorry, these questions are so dry. They’re killing me.”

How did investors take Musk’s attitude on the call? Not well. Shares fell 5%.

Short-Sellers

Musk has a turbulent relationship with investors and has made many remarks about short sellers.

Most recently, the Tesla chief executive mocked the US Securities and Exchange Commission (SEC), labelling them on Twitter as the “Shortseller Enrichment Commission” and claiming that short selling “should be illegal”.

Short sellers hope to gain from a company’s share price falling by “borrowing” shares, selling them on and buying them back in order to return them. If they buy them back at a lower price than what they sold for, they will make a profit.

More than a quarter of Tesla’s publicly traded shares are on loan to short sellers, which Musk has expressed frustration over.

In 2012, he wrote a revised tweet which suggested that short sellers were “often unreasonably maligned”.

British Diver Tweet

Perhaps his most controversial use of Twitter was Musk’s tweet accusing British diver, Vern Unsworth, of being a paedophile.

After Unsworth hit out at Musk’s mini-submarine that he had commissioned to rescue the 12 trapped Thai boys as a PR stunt, Musk wrote on Twitter: “Sorry pedo guy, you really did ask for it.”

The tweet was later deleted but Unsworth went onto seek a lawsuit and sue Musk for $75,000 (£57,000) in compensation and an injunction against Musk to stop further allegations.

$420 – “Funding Secured”

On August 7, the Tesla chief executive sent shares up on his tweet suggesting plans to take Tesla private. 

“Am considering taking Tesla private at $420. Funding secured,” he tweeted.

After it was revealed that he did not actually have the “funding secured,” shares plummeted and short-sellers were thought to have lost millions thanks to his comments.

It was this tweet, that recently led the SES to carry out an investigation and give Tesla and the chief executive a $20 million fine each, whilst also making Musk resign as chairman.

Joint On Live Web Show

Last but not least, we remember Musk’s questionable decision to smoke marijuana on a live web show, causing shares to fall 6%.

He spent two-and-half hours on the streamed podcast and took a puff from the joint.

He later added that he “almost never” smoked marijuana, saying, “I don’t find that it is very good for productivity”.