Tesla Motors CEO says NYT rift cost company millions(Read article summary)
Tesla Motors CEO Elon Musk says the New York Times article on the company's Model S sedan cost Tesla Motors as much as $100 million, Ernst writes.
The strange and curious case ofÂ The New York TimesÂ versus Tesla just wonâ€™t seem to go away. What was supposed to be a tech piece on Teslaâ€™s newÂ Supercharger fast-charging stations, written byÂ N.Y. Timesreporter John Broder, turned intoÂ fuelÂ for the range-anxiety bonfire when the electricÂ Model S sedanÂ reportedly left Broder stranded.
Teslaâ€™s [NSDQ:TSLA]Â Elon Musk quickly fired back, denying that the facts were as Broder had presented them. The Tesla CEO soon backed up his allegation withÂ data logs from the drive, showing that all was not as the reporter had written.
Ultimately, neither side backed down, although an editor fromÂ The New York TimesÂ did admit that Broderâ€™s data (scrawled in a leather-bound notebook) couldnâ€™t match the accuracy of Teslaâ€™s data (compiled in lurid detail by computer). In the end, both sides seemed to agree to disagree.
At least until Monday, when Musk put a price on the damage done byÂ The New York TimesÂ article.Â BloombergÂ quotes Musk as saying, â€śIt probably affected us to the tune of tens of millions, to the order of $100 million.â€ťÂ
By Monday, Teslaâ€™s stock had dropped around 12-percent in value sinceÂ The New York TimesÂ article ran. On February 8, a share was priced at $39.24, but by yesterday afternoon this had dropped to $34.38, reducing Teslaâ€™s market capitalization by an estimated $553 million according toÂ Bloomberg.
Musk also believes the article cost his company â€śa few hundredâ€ť Model S orders, which wonâ€™t help the electric automaker reach its stated goal of 20,000 sales in 2013. Each Tesla Model S delivered results in average incremental sales of two more cars, so a loss ofÂ 200Â sales is a potential loss of 600 total sales.
Musk still predicts that Tesla will beÂ profitable in the first quarter of 2013, so in the grand scheme of things perhapsÂ The New York TimesÂ article wasnâ€™t that damaging after all. For better or for worse, itâ€™s kept the Tesla brand in the spotlight since February 8.