Tesla's Elon Musk vs. the SEC: Did he violate a court order?

Tesla's Elon Musk vs. the SEC: Did he violate a court order?

Tesla's Elon Musk vs. the SEC: Did he violate a court order?

"As a result of keeping significantly more stores open, Tesla will need to raise vehicle prices by about 3% on average worldwide", the company said. And prices for the Model 3 will still fall, as Tesla promised earlier this month, confirming this car's position as the affordable entry model for the range.

But he also said the move to close 10 percent of stores and evaluate others is the right thing to do, and said most retail companies do that all of the time. Tesla hasn't announced how many stores will remain open, but the company says it will be reopening "high visibility locations that were closed due to low throughput", along with a handful of other stores that are now being evaluated for effectiveness.

Tesla's PR notes that all vehicles sales will still be conducted online, though it also states that a small number of vehicles will be on-hand for immediate purchase.

The hike will not affect Tesla's base Model 3, which $35,000 price tag makes it the most affordable of Tesla's lineup.

Barclays analyst Brian Johnson cut his price target for Tesla shares to US$192 from $210 on March 5, citing concern that the company's ability to sell electric cars at high volumes with strong margins would be undermined by the store closings.

The carmaker had claimed complete transition to online sales would allow it to slash prices by 6 percent, and that is how the company would sustain sale of the $35,000 Model 3.

Recently, though, Tesla seems to be somewhat prone to waffling as opposed to sticking with a coherent game plan.

The electric car-maker revealed it was backing off its plan to close all of its US stores in a blog post on Monday.

On Feb. 19 Musk tweeted that Tesla would produce around 500,000 vehicles this year - a tweet that wasn't blessed by the person in charge of baby-sitting Musk's Twitter account as required by the fraud settlement. The company did emphasize that all sales would still be online only-salespeople will show customers how to order vehicles via an app. The 7-day/1,000 mile test drive policy will still apply as well, though test drives will still be available in stores.

On Monday morning, SEC Chairman Jay Clayton declined to comment when approached by Reuters at an event in Washington on what penalties the agency planned to pursue against the billionaire. Given The Economist Intelligence Unit is forecasting consumer price inflation of 2.2% in the USA, this is less than a 1% increase in real terms. Sales of the Model 3 have fallen almost 80 percent since that time.

The blog post doesn't give a rationale for why Tesla is backpedaling.

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