Tag: Apple

I think there's a 25% chance Musk remains Tesla CEO: Munster
2 Hours Ago | 09:06

The fraud charge for Tesla founder and CEO Elon Musk could spark positive change at the electric car maker, said Gene Munster, managing partner of technology-focused venture capital firm Loup Ventures.

“I think this is actually, strange as it sounds, may be a positive force for some change at the company. We've been advocating that Elon has a different role — stays at Tesla but different visionary role, non investor-related focus. I think there's an opportunity this will pave the way for some of that,” Munster said Thursday on “Closing Bell.”

Musk has been sued by the Securities and Exchange Commission for fraud, according to court documents filed Thursday. Sources close to Tesla told CNBC that the company was also expecting to be sued, though it was not named as a defendant in the complaint.

In August, Musk tweeted that he was considering taking Tesla private, adding “funding secured.” The tweet spurred a scandal-ridden fall for Tesla and sent the stock seesawing for weeks.

“This unjustified action by the SEC leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way,” Musk said Thursday in a statement.

I'm surprised shareholders are shocked Musk was charged: Citron's Left
2 Hours Ago | 03:31

Munster said there's “greater than 50 percent” chance Musk gets removed as an officer, because the SEC, “they want blood here.” Munster said it is unlikely Musk will be ousted from the company completely — a fear he said is fueling Tesla's sharp after-hours decline.

“Investors are jumping to that conclusion … that will be on investors minds' for a long time. But that is only one of four remedies for being found guilty of securities fraud, and keep in mind, he has not been found guilty,” Munster said.

Although he thinks the charge could push Musk into a position that better suits his talents for “product and vision” at Tesla, he admitted the news “plays into the difficulty that Tesla is having,” and will likely keep the company's stock “range-bound for probably the next three months.”

“The most important part is that he remains an important part of the fabric of that company … and he can do that without having a spot on their board or an investor-facing role,” Munster said.

Colin Rusch, senior analyst at Oppenheimer, agreed that there is a need for additional leadership at Tesla. He compared Tesla to Apple, which saw its stock appreciate “pretty significantly” for several years after CEO Steve Jobs left.

“We wouldn't be surprised to see Musk settle this fairly quickly,” he said on “Closing Bell.” “He probably does want to stay involved in the company in an active way and will try to do that.”

Shares of the automaker fell more than 10 percent in extended trading Thursday.

— CNBC's Sara Salinas contributed reporting.

Another Tesla Inc. vice president is leaving the company, according to people familiar with the matter, as Elon Musk struggles to contain an exodus of senior executives. Liam O’Connor, vice president of global supply management, has resigned from the electric-car maker, said the people, who requested anonymity because the information hadn’t been made public. Tesla… Continue reading Tesla is said to lose supply management VP as exodus continues