BENGALURU: Shares of Tesla Inc jumped 18% on Monday as signs that it had achieved targets for quarterly production volumes added to the redemption at Elon Musk, a deputy who closed a lawsuit with regulators that could have eliminated him.
Tesla shares sank last week after the US Securities and Exchange Commission accused Musk of securities fraud, which would reduce the prospect of a drawn-out fight that would kill Tesla's leader, reduce capital's ability to raise capital and undermine lapsed operations.
Under the settlement, Tesla and Musk will each pay $ 20 million to the securities regulator and Musk will retire as chairman, but will remain as chief executive.
Analysts hoped that the deal would close several months of volatility around Tesla's shares, driven by a series of tweets and public statements by Musk, and that investors could concentrate on the company's efforts to boost production.
Automotive news website After the opening, Electrek reported that Tesla had produced 53,000 of its Model 3 sedans in the third quarter, citing a source that was familiar with the case.
That was good for a company promise in August that it would produce 50,000 to 55,000 vehicles in the quarter and compared with 28,578 in the previous three months. Elektrek also reported that it had produced a record total of 80,000 vehicles in total, compared with 53,339 in the second quarter.
Tesla did not immediately respond to requests for comments.
The company's shares rose 14.9% at US $ 304.19.
"We believe that Musk's arrangement with the SEC is positive for all stakeholders and should allow TSLA to re-focus on producing high-quality cars," said Baird analyst Ben Kallo.
Lawyers said in the weekend that the scheme and the size of the fine could give more ammunition to short-sellers who pursue separate cases against Musk for manipulating the company's shares and a probe by the Ministry of Justice.
But several experienced pleaders said on Monday that, while the DOJ probe is separated, the SEC settlement might signal an end to an official action against Tesla and Musk.
"The standard of evidence for a possible criminal charge is higher than that of a civil case that the SEC had," said Jay Dubow, a former municipal executive in the SEC's enforcement division.
"It is possible that the DOJ investigation does not result in a criminal charge, at least in part because the DOJ could establish that the SEC's action has resolved the matter and that no further government measures are needed."
Musk, whose tweets on August 7 on a plan to take Tesla private that was later abandoned, only tweeted once the settlement was announced – the placing of a music video by rap group Naughty by Nature.
Model 3 is seen by analysts as crucial for the long-term prospects of the car manufacturer and Musk has promised that the performance will make the company profitable in the third quarter.
"We are close to achieving profitability and prove the no-sayers wrong, but to be sure, we have to perform very well tomorrow (Sunday)", Musk wrote in a mail to employees on Saturday.
As part of the settlement with the SEC, Tesla will appoint an independent chairman, two independent directors and a committee of the board of directors to arrange communication about the communication of Musk under the proposed agreement.
"The new independent chairman and board members must drastically improve corporate governance and broaden the pool of potential investors," said Kallo van Baird.