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Tesla Investors Approve Stock Split; Musk to add factories

DETROIT (AP) — Tesla shareholders on Thursday approved a three-for-one stock split, a move that will make the company’s stock more accessible to small investors.

The preliminary results of the shareholder vote were announced at the electric car and solar panel maker’s annual meeting at its new factory in Austin, Texas.


What You Need to Know

  • Tesla shareholders on Thursday approved a three-for-one stock split, a move that will make the company’s stock more accessible to small investors.
  • CEO Elon Musk also discussed major factory expansion in the future as the company moves toward a goal of making 20 million vehicles a year.
  • Tesla shares closed Thursday at $925.90, down 12.4% year-to-date, but nearly completed a split, falling more than 40% in May after Musk made a $44 billion offer to buy Twitter in April.
  • Investors were worried that Musk would be distracted from Tesla if he bought the social media platform

CEO Elon Musk also discussed at the meeting a major expansion of the factory in the future as the company moves towards the goal of making 20 million vehicles a year. It now produces around 1.5 million a year.

Musk said Tesla could announce another factory this year and expects to have about a dozen in the future. The company currently has assembly plants in Fremont, California; Austin; Berlin and Shanghai. Musk joked that many had suggested Canada as the site for the next new plant.

The company has made its No. 3 vehicle in recent weeks, Musk said.

Tesla shares closed Thursday at $925.90, down 12.4% year-to-date, but nearly completed a split, falling more than 40% in May after Musk made a $44 billion offer to buy Twitter in April.

Investors were worried that Musk would be distracted from Tesla if he bought the social media platform.

But Musk backed out of the deal in July, and Twitter sued him to force him to make the purchase. A trial is scheduled for October in Delaware Court of Chancery. Tesla’s stock started to rally in July, boosted by better-than-expected second-quarter earnings.

Tesla announced plans for the split in late March, when the stock was trading above $1,000. It won’t affect Tesla’s global market value or its status as the world’s most valuable automaker.

Companies use stock splits when their stock price is too high for retail investors to buy individual shares, or when a company wants more shares on the market to make the stock more liquid to trade.

Tesla said it was trying to achieve these two goals: to offer its employees larger amounts of stock and to make the stock more accessible to retail investors.

Musk sold some Tesla stock for the Twitter purchase and had planned to use other shares as collateral.

Shareholders also re-elected Ira Ehrenpreis and Kathleen Wilson-Thompson to Tesla’s board.

Tesla Investors Approve Stock Split; Musk to add factories

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