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Odds Against Elon Musk Stepping Down as CEO of Tesla

Robert Duff

by Robert Duff in News

Feb 26, 2019 · 2:52 PM PST

Elon Musk
Elon Musk at the Tesla Factory, in Fremont, CA. Photo by Maurizio Pesce (flickr)
  • Tesla CEO Elon Musk is considered a visionary by business insiders
  • At the same time, he’s also viewed as a loose cannon
  • Regardless, sportsbooks are offering odds against Musk stepping down as head of the company

Some view Tesla CEO Elon Musk as a man with a vision beyond today. He possesses an almost cult-like following among his most ardent supporters. But his detractors worry that he is a loose cannon and that’s not a good quality for the front man of a publicly-traded company.

Nonetheless, sportsbooks are out with a prop bet with odds favoring that Musk won’t be stepping down as CEO of Tesla, the maker of electric cars. Musk is in hot water over a tweet that the Securities and Exchange Commission alleges is in violation of a settlement agreement it had reached with him in October.

Odds on Elon Musk Outcome from Recent Tweet

Outcome Odds on Elon Musk Outcome From Recent Tweet
Fined by SEC only +100
Neither fined or step down as CEO +100
Both fined and step down as CEO +500
Step down as CEO of Tesla only +1000

*All odds taken on 02/26/19

Musk’s often careless behavior has caused problems with regulators, stockholders, and even fellow employees.

Musk Tweet: Is He in Contempt?

At issue in his latest tussle with the SEC is a February 19th tweet Musk sent that stated Tesla would produce 500,000 cars this year, but that was incorrect. Tesla announced production plans for 400,000 vehicles in 2019.

Since Musk had not sought Tesla’s permission to send out the tweet, the SEC said that he was in violation of an October agreement between the two sides and asked a Federal Court to find him in contempt of said agreement.

Musk sought to fix things by posting a corrected tweet later in the day.

A Federal Court judge has given Musk until March 11 to explain why he should not be held in contempt.

The CEO vs the SEC

It was another Tweet, on August 7th, 2018 that launched Musk’s troubles with the SEC and the ensuing battle that continues to escalate, about his musing on Twitter of plans to take Tesla private.

His statement that funding was secured to take the company private was proven false. In the October settlement with the SEC, Musk was permitted to remain as Tesla CEO but in return agreed to his removal from the company’s board chairman position. Going forward, he now needs pre-approval from Tesla lawyers before tweeting any company information considered to be material to investors.

The day after his February 19th tweet, the one that once again landed Musk in hot water with the SEC, Tesla’s top lawyer stepped down.

Heck No, He Won’t Go

The SEC cannot remove Musk as Tesla CEO but a judge could. It’s unlikely that the company would do so.

For all the headaches he causes them, Musk is the brains behind their operation. It’s doubtful that Tesla would be a viable operation without him.

Expect Musk to be fined, and nothing more to happen.

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