Elon Musk launches investigation into sabotage at Tesla

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In a leaked email, Musk says a member of staff made "direct code changes to the Tesla Manufacturing Operating System" under false usernames. "His stated motivation is that he wanted a promotion that he did not receive". But there could be more to the disgruntled employee's actions: "There may be considerably more to this situation than meets the eye, so the investigation will continue in depth this week".

These, in Musk's words, include "Wall Street short-sellers, who have already lost billions of dollars", "oil and gas companies", as well as "big gas/diesel auto company competitors". In the lawsuit, Tesla said the email was part of an oil-industry effort to undermine the company's push for energy-efficient transportation.

Tesla's stock price slipped 53c to $370.30 in after-hours trading on Monday. That halted a seven-day run to 370.83. For context, as of June 5, the company was producing just 3,500 a week.


Musk had long promised to ramp up production of the Model 3 to 5,000 cars a week, but had been challenged by shortages of batteries, malfunctioning robots, and a lack of space in the sprawling Fremont factory. In the email he admonished employees to be on the lookout for sabotage. A spate of accidents involving the autopilot feature have knocked confidence and a recent earnings report said Tesla has lost $710m in the first quarter of this year.

Musk also sent a tweet aimed at short-sellers, on Sunday, giving them a warning. In a tweet on Sunday, Musk warned that those betting against the company "have about three weeks before their short position explodes". A number above expectations could send shares soaring.

The company would, he continued, "never achieve" its mission to "accelerate the transition to sustainable, clean energy" unless Tesla is able to "eventually demonstrate that we can be sustainably profitable".


Tesla has been going through a hard time lately, facing safety questions over its Autopilot system, layoffs, and production issues with its Model 3.

Also potentially creating tension on the stock Tuesday is the escalating trade war between the USA and China.

The proposed tariffs come after China responded by matching the US's preciously announced tariffs on $50 billion worth of goods set to be enacted on July 9. That's almost double what China imports from the U.S. But Tesla could interrupt American business in China in other ways. China could pose penalties such as customs delays, tax audits and increased regulatory scrutiny if Trump delivers on his threat of bigger duties on Chinese trade.


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