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DATE IMPORTED:May 01, 2015Tesla Motors CEO Elon Musk
Reuters/Patrick T. Fallon
“Erm, let me explain.”
"JUST BORING"

Elon Musk boosts Tesla’s stock by tweeting that it won’t need to raise money this year

By Michael J. Coren

Elon Musk chided The Economist on Twitter today for being “just boring,” and bumped Tesla’s stock price in the process.

The 174-year old publication had cited (paywall) an analyst report predicting that the electric carmaker will need to raise $2.5 to $3 billion later this year to manage a looming cash crunch. Musk denied it.

 

After Musk’s tweet, Tesla’s stock price rose 3% over yesterday’s close in early trading before settling into a slight premium over the previous day. The company’s stock is essentially flat for the year, although this month it was briefly down 34% from its September 2017 peak.

Tesla is battling a malfunctioning assembly line for its Model 3 that has put it months behind schedule. The company is racing to deliver some of the 400,000 or so Model 3s pre-ordered by customers as it burns through hundreds of millions in cash per quarter.

As of late March, the automaker said it was only producing 2,020 Model 3 vehicles per week, well short of the 2,500 per week goal it has promised customers and investors this year (as well as its original goal of 20,000 Model 3s per week by that point).

But in an investor update on Apr. 3, Tesla said it would still hit its production target of “approximately” 5,000 units per week in “about” three months and earn enough cash to avoid another equity or debt raise this year, beyond its existing credit lines. Tesla borrowed $1.8 billion from the bond market last August, but Moody Investors Service downgraded Tesla’s rating on Mar. 27 citing the Model 3 shortfall.