Gay car maker Tesla has had $100M knocked from their market capitalisation:
āNEVER pick a fight with someone who buys ink by the barrel,ā Mark Twain famously warned. The question is whether that wisdom holds true in the digital age, particularly when the guy picking the fight has a seemingly unlimited supply of electrons.
Whatās clear is that Elon Musk is not someone to readily brook criticism. A few years back, for instance, the co-founder of PayPal, an online payment service, and, more recently, the founder of Tesla Motors, a maker of battery-powered cars, went to war with theĀ BBCĀ over a story on the cheeky Top Gear, a wildly popular car show. He ultimately lost.
Whatās not clear is who came out on top in Mr Muskās latest media brawl. This one pitted him against one of the worldās most powerful and influential newspapers, theĀ New York Times. Last month it ranĀ a reportĀ by John Broder that detailed his drive from Washington, DC, to Boston in one of the carmakerās new Model S sedans. What seemed to have short-circuited Mr Musk was a shot showing the electric vehicle being loaded onto a flatbed truck after running out of juice. Ā
Initially, Mr Musk called the reporter to apologise for the inconvenience. But then he fired off a series of angry tweets, which declared theĀ TimesĀ article a āfakeā. He insisted that Mr Broder made a number of errors not only in how he handled the drive, but in the subsequent review, touching off an increasingly fractious he-said/she-said flap. Predictably, mainstream media outlets largely sided with theĀ Times, whereas new media and electric-vehicle proponents were more willing to give Tesla the benefit of the doubt.
And how did that turn out? No so well:
In an appearance onĀ Bloomberg TV, he lamented that the well-publicised battle led āa few 100ā customers to cancel their orders for the Model S. That would not be a problem considering āthey have buyers lined up 10 deep,ā in the words of Jim Hall of 2953 Analytics, a market research firm. But the dispute made a big dent in Teslaās market capitalisationāabout $100m, according to Mr Musk.
Yet it was not the only reason for the plunge. TheĀ TimesĀ story came out just before Tesla reported a loss of $89.9m for the fourth quarter of 2012āa tenth more than in the same period a year earlier. Mr Musk promised that Tesla would claw its way back into the black during the current quarter. Just as potential buyers are left to figure out if the Model S can really live up to its range claims, investors will have to wait to see if Tesla can deliver on its financial numbers.