Tesla reportedly faces FBI investigation over production numbers

Wednesday, 31 Oct, 2018

It is known that the electric auto Model 3 is a key part of the company's plans of expanding consumption from customers in the sector of "luxury" to a wider range of consumers.

Tesla previously confirmed the existence of a Department of Justice probe, but reports about the scope and topic of the investigation are new.

The Model Three is a key part of Tesla's plan to expand from a niche player in the luxury segment to a vehicle maker with broader appeal.

What exactly United Kingdom buyers will have to pay for a Model 3 - and just what specifications will actually be available - remains to be seen, as does the price.

Tesla first revealed in September that the DoJ was investigating Musk's tweets about having "funding secured" for a deal to take company private, saying the agency had asked for documents about such statements. As well as putting Tesla on track to sell over 200,000 cars this year, the electric saloon's strong sales revenues are "critical to make [the] business sustainable".

Musk said on Twitter in July 2017 that it looked like they could produce 20,000 Model 3 cars per month by December.

The company "received a voluntary request for documents from the Department of Justice about its public guidance for the Model 3 ramp" earlier this year and was "cooperative in responding to it", Tesla said in a statement addressing the report.

Elon Musk, the billionaire chief executive of Tesla, has said the tweet that cost him and the company $20m (£16m) each in fines by the US Securities and Exchange Commission was "worth it". Tesla was still hand-building parts of the Model 3s, people familiar with the company's production line told reporters at the time.

The probe, which has been under way since earlier this year, concerns whether the automaker told investors it was on track with targets for the closely-watched build-out of the Model 3 auto despite knowing it could not meet such goals, The Wall Street Journal reported on Friday.

As of late, Federal Bureau of Investigation officers have reached former Tesla employees to look for declaration in the criminal case, as indicated by the report. We're probably less than six months from that.

The FBI agents will reportedly interview Tesla employees in order to establish if the company was intentionally misleading its investors, over-projecting the upcoming production figures.

For months critics have been warning that cash flow problems threatened the company's survival. On a conference call with analysts, Musk said the company had delivered more cars in the past quarter than it did in all of 2016.