Einhorn Gives Back Model S as Tesla Rise Drags on Returns
(Bloomberg) -- For hedge fund manager David Einhorn, having issues with his Model S sedan was frustrating enough. Tesla Inc. shares moving against him made matters even worse.
The billionaire president of Greenlight Capital LLC wrote in a letter to clients dated Tuesday that he was happy the lease on his Tesla had ended, citing worsening problems with its touch screen and power windows. In addition, the carmaker’s shares surged 29 percent last quarter, making Einhorn’s short the second-biggest loser for his fund.
Einhorn questioned why investors who say they’re interested in Tesla’s long-term growth continue to stand by a company that’s focused them on short-term goals, including its target to make 5,000 Model 3 sedans in the last week of June.
“We wonder whether surge production techniques to support self-congratulatory tweets are economically efficient ways of ramping production, or whether customers will be happy with the quality of a car rushed through production to prove a point to short sellers,” Einhorn wrote.
A Tesla spokesman didn’t immediately comment, but Chief Executive Officer Elon Musk responded on Twitter to the news that Einhorn wasn’t renewing his Tesla lease.
Einhorn may be inclined to pass on another Tesla, but he isn’t ready to swear off electric vehicles entirely. He wrote that he’s excited to take delivery of the Jaguar I-Pace plug-in crossover -- one of several new battery-powered autos poised to take on Elon Musk’s carmaker within the next year.
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