Hedge fund manager betting against Tesla gets box of short shorts from Elon Musk: ‘He is a man of his word!’

It’s unclear when Musk sent the shorts to Einhorn but, in the past week, the Tesla chief executive has found himself embroiled in a controversial move to take his auto company off public markets. Since telling his followers he has “funding secured” for the deal, the U.S. Securities and Exchange Commission has requested more information and Tesla’s board of directors is expected to ask Musk to recuse himself as it reviews his take-private proposal.

Fellow billionaire Einhorn founded his hedge fund in 1996, becoming well known for his bet against Lehman Brothers before the company collapsed during the financial crisis in 2008. Einhorn holds a short position on Tesla shares through his hedge fund but it has cost him heavily this year: Greenlight’s fund dropped 18.3 percent in the first half of this year, with Tesla being the second-largest contributor to those losses in the most recent quarter.

Einhorn revealed the losses to his investors in Greenlight’s letter while questioning Tesla investors, saying shareholders seemed to be backing the long-term growth of the company while Tesla appears to be focusing on “very short-term goals.”

“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 rush through production to prove a point to short sellers,” the letter said.

“The most striking feature of the quarter is that Elon Musk appears erratic and desperate,” Einhorn’s letter added.

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