Howard Fischer Quoted In Grid Article On How Elon Musk's Twitter Buy Could Negatively Affect Tesla

May 5, 2022

Grid

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Howard A. Fischer was quoted in an May 5, 2022 Grid article discussing the effects the recent purchase of Twitter could have on Elon Musk's Tesla.

“Musk’s various statements about lowering head counts and not caring about advertising likely mean significant turmoil at least in the near future at Twitter, likely leading to lower earnings,” said Fischer. “The market is likely to react to these facts by assuming that Musk will have to sell shares of Tesla, or pledge more shares to secure his financing, which will put significant downward pressure on Tesla stock.”

That raises questions about what Tesla’s board is doing, if anything, to brace the company against shocks from Musk’s Twitter deal, Fischer said. He’s skeptical that Musk’s ownership of Twitter could help Tesla — and ticked off many instances where it would likely pose significant risks.

“What if statements on Twitter anger China, will China limit Tesla sales in that market?” said Fischer. “Just look at China’s reaction to the NBA after criticisms of China by some NBA employees. If Tesla faces downward share price pressures because of Musk’s ownership of Twitter, I can see significant liability for Tesla’s board based on lawsuits by unhappy investors.”