Holders of Tesla shares, the largest manufacturer of electric cars, may face serious difficulties in the near future. Elon Musk, the company’s CEO, voiced concerns about gloomy prospects for Tesla securities because investors had put a high price on profit predictions.
Musk is known for his outspoken statements in relation to business, including his own. He believes that the value of Tesla shares may plunge in the near future. "Investors are giving us a lot of credit for future profitability but, if at any point, they conclude that’s not going to happen, our stock will immediately get crushed like a souffle under a sledgehammer!” Musk wrote in the email to employees. "At a time like this, when our stock is reaching new heights, it may seem as though spending carefully is not as important. This is definitely not true!" he added.
"In order to make our cars affordable, we have to get smarter about how we spend money," he added. "This is a tough Game of Pennies, requiring thousands of good ideas to improve part cost, a factory process or simplify the design, while increasing quality and capabilities," Musk said.
It is true that Tesla shares have been growing by leaps and bounds recently. Since the beginning of this year, their price has increased by more than 600%. Besides, the company has finally been able to nab a spot in the prestigious S&P 500 index. Moreover, Tesla stocks saw a sharp rise like many other high-tech companies. They were among the biggest gainers during the coronavirus pandemic.
