Tesla stock falls as Elon Musk smokes marijuana during Joe Rogan Experience podcast


Posted

September 08, 2018 10:19:03

Shares of electric car maker Tesla have fallen more than 6 per cent after company CEO Elon Musk smoked marijuana during a podcast interview and the company’s accounting chief left after a month on the job.

Tesla closed on Friday (local time) at US$263.24 a share after the recording of Mr Musk smoking a combined marijuana-tobacco joint on the Joe Rogan Experience podcast was aired online.

Shortly after smoking the joint — which the host noted was legal in California — Mr Musk looked at his phone and laughed, saying he was getting texts from friends asking why he was smoking weed during the interview.

“I’m not a regular smoker of weed,” Mr Musk said.

When Rogan asked how often he smoked the drug, Mr Musk replied: “Almost never.”

“I don’t find that it is very good for productivity.”

As the video gained attention online, Tesla announced chief accounting officer Dave Morton had resigned after a month on the job, citing public attention and the fast pace of the role.

“Since I joined Tesla on August 6th, the level of public attention placed on the company, as well as the pace within the company, have exceeded my expectations,” the company quoted Mr Morton as saying in the filing with the US Securities and Exchange Commission.

“As a result, this caused me to reconsider my future. I want to be clear that I believe strongly in Tesla, its mission, and its future prospects, and I have no disagreements with Tesla’s leadership or its financial reporting.”

Tesla is under extreme pressure to turn a sustained net profit starting this quarter, as promised by Mr Musk. But in the second quarter, it burned through US$739.5 million in cash and lost a quarterly record US$717.5 million.

Mr Musk has said the company is producing more than 5,000 Model 3 electric cars per week, and that cash generated from the sales will bring sustained quarterly profits.

The Model 3 starts at US$35,000, although the cheapest one that can be purchased at present costs US$49,000.

Latest in the line of Musk controversies

Dartmouth College professor of corporate communication Paul Argenti said the latest controversy involving Mr Musk was not surprising.

“The behaviour on YouTube is obviously in line with what we’ve seen in the past,” Mr Argenti said.

But, he added, “You can’t go on like that forever. It catches up with you.”

Mr Musk’s conduct has been questionable since a first-quarter earnings conference call when he criticised Wall Street analysts for asking “bonehead” questions about the company’s finances.

Then, he labelled a British diver who aided in the cave rescue of Thai soccer players a paedophile, and after apologising, doubled-down on his accusation again this week in emails to Buzzfeed News.

But the most questionable action came when Mr Musk tweeted last month he had secured funding to take the company private at US$420 per share to get away from the short-term pressure of Wall Street.

The tweets pushed the electric vehicle and solar panel maker’s stock price up 11 per cent that day. But it subsequently fell when Mr Musk revealed funding was not locked down.

On August 24, Musk put out a statement saying the go-private deal was off, drawing scrutiny from the Securities and Exchange Commission.

Some analysts and investors have called on the board to replace Mr Musk as CEO but keep him as chief product officer, or hiring a chief operating officer to handle daily operations.

AP/ABC

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