After 70 percent decline in Tesla share price, Elon Musk tells employees not to be “bothered by stock market craziness”
Elon Musk’s attention this week snapped back to Tesla after he reportedly emailed staff at the electric vehicle giant.
Reuters reviewed the email Musk sent to Tesla staff, in which the chief executive said that employees should not be “bothered by stock market craziness”, despite shares in the company falling nearly 70 percent this year over concern about weakening demand for electric vehicles and Musk’s distraction with running Twitter.
Earlier this week it was reported that Tesla plans to run its key Shanghai plant on a reduced schedule in January, continuing reduced production that began this month.
The electric carmaker reportedly is to run production for 17 days next month from 3 to 19 January, stopping vehicle output from 20 to 31 January for an extended break for the Chinese New Year.
Tesla gave no reason for the slowdown, but local media have reported a number of Chinese companies reducing production amidst increasing Covid-19 outbreaks.
Now in the email sent to Tesla staff on Wednesday that was reviewed by Reuters, Musk said he believes that long term, Tesla will be the most valuable company on earth.
He also reportedly urged employees to ramp up deliveries at the end of this quarter, after the EV maker offered discounts on its vehicles in the United States and China.
“Please go all out for the next few days and volunteer to help deliver if at all possible. It will make a real difference!” he said in the email.
Analysts expect Tesla to deliver 442,452 vehicles in the fourth quarter, according to Refinitiv data.
Tesla, along with other automakers and tech companies, has seen a downturn in demand in China this year amidst ongoing lockdowns that have disrupted production and dampened consumer spending.
China is the world’s biggest car market and Tesla’s Shanghai plant, with about 20,000 workers, accounted for more than half of Tesla’s production for the first three quarters of 2022.
However Reuters reported that Tesla’s plummeting share price has hurt the value of shares owned by staff. Tesla has reportedly offered stock compensation for most employees including factory workers.
The company’s shares rebounded on Wednesday, following an 11 percent slump over Telsa’s reported plans for a reduced production schedule in January at its Shanghai plant.
“Btw, don’t be too bothered by stock market craziness. As we demonstrate continued excellent performance, the market will recognize that,” Musk reportedly wrote.
“Long-term, I believe very much that Tesla will be the most valuable company on Earth!” he added.
Reuters noted that Morgan Stanley analysts have cut their price target on the stock to $250 from $330, saying the last two years of demand exceeding supply will be “substantially inverted to supply exceeding demand” in 2023.
Tesla’s share price is currently trading at $112.71, as of Thursday afternoon.