Tesla shares fell into the bear market territory after detecting solar panel defects

On Monday, Tesla shares took a hit after a whistleblower talked about the solar panel defects. The shares went on bear market territory as prices fell as much as 20 per cent. The electric car company is seeing massive growth in recent years, making CEO Elon Musk the richest man on the planet as he holds the lion’s share of Tesla stocks. After a Twitter poll, the CEO sold a good percentage of his shares, which also caused a price drop before picking up eventually.

SEC did not comment on the matter, but general stockholders and news agencies were curious about having an investigation to know the nitty-gritty of the price fall. Reuters reported on the SCE activities that an open investigation is filled for further analysis.

The whistleblower was a former employee of Tesla that reported as a response. The solar panel had fire risk associated, and according to company policy, they needed to inform the stakeholders and come clean. But the company failed to do so. It resulted in the company’s failed property notification channel causing the bear market territory in stocks.

Fire-associated risks with the Tesla solar panel system defect continue for several years, raising concern among the U.S. securities regulator officials. The whistleblower previously worked for the company, and the agency said it received a similar letter.

Due to the popularity of both Tesla and CEO, a public offering by the CEO in a recent Twitter poll sold over 11.03 million shares valued at $11.82 billion. The CEO later exercised to buy back another 12.3 million stock options.

Many large reporting agencies said it is an effort to get out of taxation quickly as we can realise a large company such as Tesla has to pay a considerable lot.

The CEO sold 6 million shares in the open stock market out of the estimated 17 million (10% stake).

SEC probed Tesla shares fell as much as 6.4 per cent on Monday, 20 per cent higher than recent times. Within the last 52-weeks, it was the highest fall in price. Indeed November 4 was one of the days the company saw its price fall, impacting the revenue stream at a noticeable margin.

The U.S. Consumer Product Safety Commission and the SEC are investigating deep into the matter as several reports have been filed against the automaker. Henkes and other agencies also filed complaints against the Tesla solar panel company.

Reuters was the first to report the incident. Later CNBC, Bloomberg, BBC, Yahoo Finance picked up the news, and as they reached a large audience, it certainly made a ripple effect on the company finance.

Though it didn’t take long for the company to pick up the pace and fall back on track, the stain remains of the solar panel incident. They haven’t fixed issues with the solar panel and didn’t even publicly announce its plan regarding the matter.

The bear market territory for Tesla shares took away the trillionaire status of the company as the stock value plunged to $932.3 billion around 11:30 AM ET.

The company hit $1 trillion in valuation on October 25 as the share price rose $1,229.91 on November 4. Since the start of November, shares started seeing a slight decline and the whistleblower report, picked up by the stakeholders instantly, caused the bear market territory stock value drop.

Former Tesla field quality manager Steven Henkes pulling up the Freedom of Information Act with the U.S. Securities and Exchange Commission (SEC) filed complaints on solar systems in 2019.

Henkes was a former quality manager on Toyota Motor quality division, and in 2020 was fired from Tesla. SolarCity is seeing tremendous growth as the CEO has grand visions for the future with clean and renewable energy.