'We can do it!' Leaked Musk email puts Tesla on rollercoaster ride

Even by the standards of oft-volatile Tesla shares, Thursday morning will go down as one of the more memorable rollercoaster rides.

Another bearish bit of analyst commentary about the Model 3 maker facing demand woes sent the stock tumbling as much as 5.6 per cent in early trading.

Within an hour and five minutes, shares were up 3.6 per cent after a bullish internal email surfaced on a Chinese social media forum that Elon Musk had supposedly sent to employees.

It looked as though the rally would be shortlived. The shares again went negative until several media outlets, including Bloomberg, confirmed the authenticity of the email with sources who asked not to be identified. The shares rebounded again, ending the trading session 1.4 per cent higher.


Musk's memo countered days of escalating doubt that Tesla will hit its vehicle delivery targets this quarter, with the chief executive officer writing that the company had a "good chance" of exceeding the record 90,700 deliveries achieved in the last three months of 2018.

He also said the company had received more than 50,000 net new orders this quarter.

Musk's memo contradicted multiple analysts who have cast doubt on Tesla's ability to deliver at least 90,000 electric vehicles this quarter and 360,000 this year.

Gene Munster, a managing partner of venture capital firm Loup Ventures, became the latest to cast doubt on the company reaching those numbers, telling Bloomberg Television late on Wednesday that 2019 is "going to be a difficult year."


In a note on Thursday, Munster trimmed his estimate for how many vehicles Tesla will deliver this year by about 10 per cent to 310,000, short of the minimum 360,000-unit forecast by Musk.

Munster lowered his expectation to factor in the risk that China will slap Teslas with tariffs and that consumers in the world's largest electric-vehicle market may boycott the brand as the trade war with the US intensifies.

"It's been difficult for analysts and investors to guess what demand is for this year," Munster told Bloomberg TV in a follow-up interview Thursday.

The rollercoaster in Tesla's shares follows a 25 per cent plunge in market value over the course of just 12 trading days, with the shares finishing lower in all but one of those sessions. At least six analysts have cut their price target since the stretch began, according to data compiled by Bloomberg.

For Musk, 47, it's the second time in a week that an email he's sent to employees leaked to the media.

Tesla shares closed at the lowest level in almost 2 1/2 years on May 17 after the CEO wrote that the company would be conducting a "hardcore" review of expenses to protect the carmaker's cash.

Before the latest deliveries email surfaced, Munster said that Musk needed to be "more judicious" when setting expectations for what Tesla will achieve.

It's "unlikely that we're going to get that anytime soon, so whatever he says, dial it back by 40 per cent and that's probably the right answer," Munster said of Musk.

Musk has been pulled up by the US Securities and Exchange Commission in the past for disclosing Tesla's production outlook on Twitter. Under a deal with market regulator, he had agreed to get some of his statements reviewed by Tesla's legal counsel before publication, including financial statements and unreported production and delivery numbers.

It was not immediately clear if his email to employees detailing crucial delivery and production numbers violated the agreement with the SEC.

The regulator could not be immediately reached for comment, while a Tesla representative did not respond to requests for comment.

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Bloomberg, with Reuters