Tesla shares down $40 billion after Musk says big deal with Hertz not “signed yet”

Shares of Tesla Inc. they fell about 4% on Tuesday after its CEO and founder Elon Musk tweeted that an agreement to sell was reported. 100,000 cars in Hertz it had not been signed, suggesting that it was not final.

Shortly after the market closed on Monday, an account called “Tesla Silicon Valley Club” tweeted an image of a chart showing Tesla’s recent 8.5% gain and thanked Musk. Musk replied, “Welcome! If any of this is based on Hertz, I’d like to point out that no contract has been signed yet.”

Hertz had announced last week that it was buying 100,000 electric vehicles from Tesla, one of the largest battery-powered car purchases in history. The financial details of the deal, such as how much Hertz paid per car or the total price, were not disclosed at the time.

News of the deal sparked a rally Tesla sharespushing for the first time the market value of the world’s most valuable carmaker above $ 1 trillion.

“While Hertz is in the early stages of electrifying its rental car fleet, Tesla by obtaining an order of this magnitude highlights the wider adoption of electric vehicles in progress, in our view, as part of that green wave now approaching the United States, “said Daniel, an analyst at Wedbush Securities. Ives and John Katsingris said in a research note at the time of the announcement.

Then came Musk, who also suggested in the same response Monday that Hertz would not get a discount and that the deal didn’t matter to his company’s results.

“Tesla has a lot more demand than production, so we will only sell cars to Hertz by the same margin as to consumers,” Musk’s tweet continued. “The Hertz agreement has no effect on our economy.”

It’s not the first confusing tweet

This is not the first confusing tweet from the founder of the electric car manufacturer. Musk tweeted back in May, announcing that the company would do so no longer accept bitcoin as a form of payment for Tesla cars, citing environmental concerns.

In an interview with the Associated Press last week, Mark Fields, acting CEO of Hertz, said the company has the capital and a healthy balance sheet after leaving bankruptcy protection in June after the collapse of the travel industry during the pandemic.

Fields also said Tesla was already arriving at Hertz sites and should be available for rent starting in November. He added that Hertz intends to offer the largest electric vehicle rental fleet in North America.

Hertz said in its original announcement that it would complete its purchases of Tesla Model 3 small cars by the end of 2022. If Hertz paid the total sale price of $ 40,000 for each Model 3, it would make the deal worth about 4,000. million dollars the carmaker.

Tesla shares fell 4.1% in out-of-hours trading on Tuesday to $ 1,159 a share, lowering the company’s market value by $ 40 billion after a week earnings, Forbes reported.

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• Hertz