Date
20 November 2018
US authorities are looking into whether Tesla misled investors about Model 3 production rates. Photo: Reuters
US authorities are looking into whether Tesla misled investors about Model 3 production rates. Photo: Reuters

Tesla subpoenaed by SEC over Model 3 production estimates

Tesla has received a subpoena from the US Securities and Exchange Commission over forecasts it made about Model 3 production in 2017, a set of targets the electric vehicle maker failed to hit on time, Reuters reports.

The SEC issued subpoenas over “certain projections that we made for Model 3 production rates during 2017 and other public statements relating to Model 3 production,” Tesla was quoted as saying a quarterly filing on Friday.

A subpoena can compel a company to turn over materials that the requesting agency wants to review.

The SEC had also issued subpoenas in connection with Tesla CEO Elon Musk’s previous statements that he was considering taking the company private.

Both the SEC and US Department of Justice are looking at whether Tesla misled investors about its business.

“To our knowledge no government agency in any ongoing investigation has concluded that any wrongdoing occurred,” Tesla wrote in its filing.

Following the launch of the Model 3 last year, Tesla repeatedly missed aggressive production targets for the new vehicle, blaming “manufacturing bottlenecks”, Reuters noted.

Tesla is already facing a proposed class action shareholder lawsuit claiming that the company and top executives made false statements about the readiness of the Model 3 for volume production.

The lawsuit cites repeated promises in 2017 that Tesla was “on track” to build 5,000 Model 3s per week by the end of that year at its factory in Fremont, California.

Tesla finally met that target in June of this year.

Tesla has denied the claims, saying it disclosed production bottlenecks once identified, and pointing to Musk’s public statements that the company was undergoing a period of “production hell” in 2017.

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RC

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