For those of you following the bouncing Elon, here’s a brief summary of his activities:
1. Tesla met its production goals of 5,000 S3 vehicles per week in June by adding a third production line in a tent, but has not met the 5,000 production goal since.
2. On August 7, 2018, Musk tweeted (always a good way to announce a stock-purchase plan) that he had secured funding for taking Tesla private at $420 share. The Twitter/weed subculture noted that 420 is code for marijuana.
3. The SEC announced an investigation because, well, those kinds of announcements about going private can affect markets.
4. Once the Tesla board got involved, Musk decided in mid-August there were too many problems with going public.
5. The SEC is still investigating.
6. Tesla’s chief accounting officer then resigns — suddenly, last week. He had just had his first day on August 6 and noted that “the Tesla culture proved to be a bad fit.” This kind of activity also tends to move markets.
7. Elon Musk showed up on a podcast with comedian Joe Rogan, drinking whiskey, and then smoking pot. With each assuring the other that smoking pot was “legal.”
8. Not announced yet — the Air Force will need to catch up on the marijuana — it may be legal in some states, but for security clearance, necessary for the work SpaceX does for the federal government, Mr. Musk needs to be drug-free, including marijuana. There is a notice on the security clearance form that reminds applicants for clearance that legality in the states makes absolutely no difference to the federal government. Marijuana is a no-no for federal contractors.
Erratic behavior, defiance, and a company sinking. Classic entrepreneur with a big vision who cannot do nuts-and-bolts of the day-to-day drudgery of running a business within legal and ethical boundaries. The pattern is always the same. Think Uber, American Apparel, and a host of Silicon Valley firms grappling with visionary CEOs who buck the system to develop their products and then continue bucking the system as they try to operate a business — unless they are reined in. That’s a board job, but the vision of strong directors who take charge is still missing and inaction has its effects. Tesla’s stock is down to $260 per share. The SEC has its case made.