One day after Elon Musk amused his 20 million twitter followers with a Tesla bankruptcy April Fool’s joke…
Tesla Goes Bankrupt
Palo Alto, California, April 1, 2018 — Despite intense efforts to raise money, including a last-ditch mass sale of Easter Eggs, we are sad to report that Tesla has gone completely and totally bankrupt. So bankrupt, you can’t believe it.
— Elon Musk (@elonmusk) April 1, 2018
… this morning shareholders of Tesla are hardly laughing, with Tesla stock tumbling as much as 5%, down to $254, the lowest level since March 2017, and down 15% YTD.
And while we doubt that Musk’s “joke” prompted the selloff – even if it does cut too close to comfort for the company that burned $3.5 billion in cash last year…
… Tesla has seen a spate of negative news over the past few days, including a rating agency downgrade of the company’s bonds deep into junk status, a recall of all Model S cars built before April 2016, a fatal accident last month involving the company’s driver-assistance system and a growing consensus that the carmaker’s first-quarter deliveries may fall below expectations.
As a reminder, last week, Moody’s downgraded Tesla over concerns about Model S production and a warning it may need another $2 billion in liquidity sending its bonds tumbling, with the yield surpassing that of Ukraine.
Tesla also recalled 123,000 Model S vehicles due to problems with the power-steering component, saying it saw “excessive corrosion” in the power-steering of affected cars.
As we reported overnight, Tesla also admitted that the car involved in a fatal crash in California last week was operating on Autopilot mode, although it claimed that the autopilot was not at fault. This in turn prompted a furious rebuke from the NTSB, which was angry that Tesla was clouding the conclusion by presupposing that the autopilot had no guilt:
