Published: Tue, October 02, 2018
Markets | By Erika Turner

Tesla shares soar after Musk settles with SEC

Tesla shares soar after Musk settles with SEC

Musk agreed to resign as Tesla chairman within 45 days as part of his settlement with the SEC.

Elon Musk's decision to give up the chairmanship of Tesla and pay a fine to the USA financial regulator over his Twitter announcement that he was going to take the electric vehicle group private sent the shares up by almost a fifth.

This is only the midpoint of his Musk-sational 2018 narrative.

Besides the settlement news, Tesla has another milestone this week.

Under a settlement announced over the weekend, Musk will give up his post as Tesla's chairman for at least three years. This SEC run-in may prove the white knight to a Tesla in distress, shackled to the whims of a stretched-too-thin executive. In addition, Tesla agreed to appoint two more independent directors to its board, and exercise more control over Musk's statements on social media as well as via more traditional channels of corporate information.

In addition, Grimes' ex will be on a short leash: Tesla now gets to monitor the communications of the outspoken ex-chief gunslinger.

Mr Musk settled fraud charges with America's stock market watchdog and said that the company was close to profitability.

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The company has recently been struggling to meet audacious production goals for its Model 3 sedan.

Tesla has been hustling to deliver Model 3 cars at the end of its financial third quarter.

Musk and Tesla were also fined $20million each. The brainchild of Tesla has a couple of times been associated with more than one actions that have landed him in trouble with his investors and even the media.

You see, even with offerings like the Toyota Prius and Nissan Leaf, the idea of a market-friendly electric vehicle that's both stylish and fun-to-drive has never been more mainstream than it has with Musk and Tesla leading the charge. Monday's gains erased Friday's 14 percent plunge after the SEC filed its lawsuit late on Thursday.

A tweet can be worth a thousand words, or in Elon Musk's case, millions of dollars.

'The open board chairperson role creates an opportunity for Tesla to potentially put someone in place that is capable of influencing Musk and helping Tesla reach sustainability, ' said Munster, who is a noted Tesla bull.

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