Tesla receives SEC subpoena over Model 3 production

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UPDATED: 11/2/2018 11:57 am ET

Tesla Inc. said on Friday that it received a summons from the Securities and Exchange Commission regarding Model 3 production prognoses that the maker of the electric car made in 2017.

Tesla has repeatedly missed production deadlines for the Model 3 sedan and is being investigated by multiple government agencies for misleading investors about its activities.

The company said in a filing that no government agency in ongoing investigations concluded that something went wrong.

"It sounds like the SEC is checking whether or not the predicted projections were based on facts or not," said Jay Dublow, a Pepper Hamilton LLP partner.

"It is possible to carry out another SEC enforcement action if it appears that the projections have been made deliberately or recklessly without a basis," said Dublow, a former head of division in the SEC's enforcement division.

A Tesla spokesperson told Reuters in October that the company had received a voluntary request from the Ministry of Justice for documents relating to Model 3 production forecasts.

The Federal Bureau of Investigation is also investigating whether Tesla reported information incorrectly about the output of Model 3 from the start of 2017, according to reports.

Peter Haveles, a partner in the Trial and Dispute Resolution Practice Group, said the SEC could not file an indictment if there was a basis for the prognoses.

"However, as was the case with private tweets, if the SEC concludes that the forecasts and comments were made without a reasonable factual basis, it is likely that the SEC will start a new enforcement action against Tesla," Haveles said.

The Wall Street Journal reported in August that the SEC had started an investigation into the production report of Model 3 of the company in 2017.

In September, Musk and Tesla agreed with the SEC on Musk's August 7 tweets that he planned to take the company for $ 420 privately and that they had earned money for a deal.

Before the settlement, Tesla and Musk each had to pay a fine of $ 20 million. Moreover, Musk also had to give up the chairman of the job for three years.

Tesla is still below its weekly production target of 5,000 Model 3's, but managed to make a profit in the third quarter, as promised by Musk.

Earlier on Thursday, Tesla said it was planning to develop approximately 3000 Model 3 vehicles a week in Shanghai in the initial stages of its Gigafactory 3 to reduce the impact of the tariffs.

The company said in an application that the sales of Model S and Model X in China, and likely will continue to be, are hurt by recently increased rates imposed by the Chinese government on US vehicles.