“It was not funny, because it’s not a joking matter,” said Gene Munster, who leads research for the venture-capital firm Loup Ventures. “It wasn't appropriate, because they had probably their worst week since the company was started, and it’s just not the week to be making jokes.”
Investors didn't appear in a laughing mood: Tesla shares dropped 5 percent Monday amid a 2.7 percent drop in the tech-heavy Nasdaq composite index, though they were up more than 4 percent in trading Tuesday morning after a company statement said it had boosted production of its Model 3 vehicles from the fourth quarter.
For those who missed it, Musk sent a tweet Sunday with the headline “Tesla goes bankrupt,” saying that “despite intense efforts to raise money, including a last-ditch mass sale of Easter Eggs, we are sad to report that Tesla has gone completely and totally bankrupt. So bankrupt, you can't believe it.” In follow-up posts, Musk joked that “there are many chapters of bankruptcy and, as critics so rightly pointed out, Tesla has them *all*, including Chapter 14 and a half (the worst one)," and a final one that pictured a stubble-faced, passed-out Musk holding a sign saying “Bankwupt.”
“Musk was found passed out against a Tesla Model 3, surrounded by 'Teslaquilla' bottles, the tracks of dried tears still visible on his cheeks,” Musk wrote, continuing the news story conceit, before noting “this is not a forward-looking statement, because, obviously, what's the point? Happy New Month!”
On Monday, he underscored the joke, responding to another tweet by saying “obviously, I’m not going to do an April Fools' joke about going bankwupt if I thought there was any chance it would actually happen (sigh).”
Many Twitter users found it funny. “Great April Fools! Where can we buy Teslaquilla?” wrote one.
But even if any reasonable investor would get the joke — and even if it may have been intended to address detractors — some questioned whether it was a good decision, given a string of recent negative headlines.
On Thursday, the company recalled 123,000 of its Model S sedans after discovering that corroding bolts could lead to a loss in power-steering. The credit agency Moody’s downgraded the company’s rating last Tuesday, noting Tesla could have to raise $2 billion as it fails to meet production expectations. The week prior, a semiautonomous Tesla Model X using the company's Autopilot system was involved in a fatal crash.
“Elon plays by his own rules, but I think he underestimates the weight of his own words,” said a former Tesla executive who spoke on the condition of anonymity to talk openly.
“It’s perfectly appropriate to try to inject levity and a kind of personality into your communications, but not when you’re under scrutiny as a result of a death,” said Paul Argenti, a professor at Dartmouth College's Tuck School of Business. “If I were a shareholder, I wouldn't find that funny.”
Musk's tweets also came after the stock had dropped 14 percent since the day before the crash and even further off its high from June 2017. “Given what’s happened, it’s in poor taste, poor judgment,” said Charles Elson, the director of a corporate governance center at the University of Delaware. “If you’re joking to a friend, okay — but to a mass audience of investors?”
Tesla did not immediately respond to a request for comment. In a statement posted to the company's website about the crash on Friday, Musk said the company has been criticized for bringing up statistical data in the past, “implying that we lack empathy for the tragedy that just occurred. Nothing could be further from the truth. We care deeply for and feel indebted to those who chose to put their trust in us. However, we must also care about people now and in the future whose lives may be saved if they know that Autopilot improves safety.”
Others said that while the timing of the tweets was unfortunate, they didn't think the prank would have a big impact.
Joseph Grundfest, a former SEC commissioner and professor at Stanford Law School who said he has used Musk's 2015 April Fools' joke in a class seminar, said that while it may not have been the “best idea Elon has ever had, because it opens him and the company up to unnecessary criticism and questioning about something that was clearly intended to be a joke,” it likely didn't pose risks.
“Legal liability arises from a reasonable investors’s standard, not that of a humorless irony-ignorant automaton,” he said. “Any sensible person reading [the tweet] wouldn’t for a millisecond think it purports to be anything close to an accurate representation of the truth. It’s a joke.”
Meanwhile, Ben Kallo, an analyst at Robert W. Baird & Co who has an outperform rating on Tesla's stock, called it “brash” but wasn't concerned about the remarks.
“It ruined my Easter dinner, but at the same time, it was his response — doing something outlandish to the outlandish comments about [Tesla] going bankrupt,” he said. “I don't like the timing of what he did yesterday, but I also understand he is telling the market and his employees and all his stakeholders that this is ludicrous.”
A previous version of this article suggested that the Uber involved in a March 18 crash in Arizona used Tesla's Autopilot system. It did not.