Negative Review Costs Tesla $100 Million, CEO Says


  • Tesla Model S Picture

    Tesla Model S Picture

    A negative review trimmed Tesla Motors' stock-market value by as much as $100 million, Tesla CEO Elon Musk said. | February 26, 2013

Just the Facts:
  • A negative New York Times review of the Tesla Model S and the company's East Coast Supercharger system trimmed Tesla's stock-market value by as much as $100 million, according to Tesla CEO Elon Musk.
  • Musk made the comment to Bloomberg Television on Monday, noting that the effect of the review is "not trivial."
  • Tesla Motors would not officially comment on Musk's remarks, but a company insider told Edmunds that Musk is putting a value on the company, not speaking about vehicle cancellations.

PALO ALTO, California — A negative New York Times review of the Tesla Model S and the company's East Coast Supercharger system trimmed Tesla's stock-market value by as much as $100 million, according to Tesla CEO Elon Musk.

Musk made the comment to Bloomberg Television on Monday, noting that the effect of the review is "not trivial."

Tesla Motors would not officially comment on Musk's remarks, but a company insider told Edmunds that it wasn't "actual cash that was lost." Musk is putting a value on the company — or its market capitalization — not speaking about vehicle cancellations, the insider said.

The Times earlier in February published a review saying the Model S did not meet range expectations during a test-drive in bitterly cold weather. Musk disputed the review, calling the story a "fake." The public editor of the newspaper later admitted there were flaws in the story written by reporter John Broder.

On February 19, Musk thanked customers in a blog post on the Tesla Web site, noting they "rallied immediately to the defense of Tesla and the electric car revolution, sending hundreds of heartfelt letters of support to the New York Times in the space of a few days."

He added: "Entirely of their own volition, several customers spent the past holiday weekend re-creating the Broder test drive route and showing that it can be done easily using the Tesla Supercharger network on the East Coast. You guys are awesome!"

Edmunds says: More fallout from the dispute between Tesla and The New York Times.

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