- Tesla (TSLA) stock is set to record a weekly loss following a combined 22% gain in the previous two weeks.
- Another executive has left the company, and U.S. prosecutors are reportedly investigating Tesla for potential securities and wire fraud related to Full Self-Driving (FSD) capabilities.
- Rich Otto, Tesla’s head of product launches, announced his resignation last week, citing recent layoffs that have disrupted the company’s harmony.
Tesla’s stock performance and recent executive departures raise questions about the company’s future growth and stability. This article delves into the details and potential implications.
Executive Departures and Layoffs at Tesla
Rich Otto, Tesla’s head of product launches, announced on LinkedIn last week that he had resigned. This follows the dismissal of Rebecca Tinucci, senior director of Tesla’s supercharger efforts, and Daniel Ho, head of the new vehicles program. CEO Elon Musk has also reportedly cut teams under Tinucci and Ho, laid off public policy employees, and the entire staff in charge of Tesla superchargers. Otto cited the recent layoffs as a disruption to the company’s harmony.
DOJ Investigates Tesla’s Full Self-Driving Claims
The U.S. Justice Department (DOJ) is reportedly examining claims by Musk and Tesla that suggest vehicles can drive themselves autonomously. The DOJ is also investigating whether Tesla committed wire fraud and securities fraud by misleading investors about FSD capabilities.
Tesla’s Stock Performance Amidst Controversies
TSLA shares jumped 7.7% last week to 181.19 after soaring 14.4% in the prior week. However, the stock fell 1.7% to 171.97 during market trade on Thursday and is down more than 5% for the week. Since Tesla reported first-quarter earnings and revenue on April 23, Tesla has gained about 20%. However, shares are still down 30% in 2024 as of May 9.
Conclusion
While Tesla’s stock has seen some gains following its Q1 earnings report, the recent executive departures and potential legal troubles pose significant challenges. Investors and market watchers will be keeping a close eye on developments in the coming weeks.
