Elon Musk steps down as Tesla Chairman after Controversial Tweet

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Bloomberg reports that Tesla's plunging stock price is a sign that investors wanted Musk to cut a deal with the Securities and Exchange Commission as soon as possible.

Mr Musk, Tesla's controversial co-founder and chief executive, bowed late on Saturday to demands from America's financial markets watchdog to relinquish his seat at the head of the board.

The news of Tesla CEO Elon Musk settling with USA financial regulators sent the company's stock soaring Monday morning. The complaint "alleges that Musk violated antifraud provisions of the federal securities laws, and seeks a permanent injunction, disgorgement, civil penalties, and a bar prohibiting Musk from serving as an officer or director of a public company", the SEC said on Thursday when it filed the complaint at court.

Still, despite the ever-present controversy and turmoil surrounding Musk and his baby, Tesla still has a ton of believers on social media.

In 2013, the company stated that it would use Musk's Twitter account as a means of announcing material information, however this has been diluted over the years by tweets of Musk's other firm, The Boring Company and various personal jokes.

But several experienced litigators said on Monday that, while the DOJ probe is separate, the SEC's settlement could mark the end of official action against Tesla and Mr Musk.

Musk and Tesla must each pay $20 million in fines, which will be distributed to traders who were harmed by the tweets.

Automotive news website Electrek reported after the opening bell that Tesla had produced 53 000 of its Model 3 sedans in the third quarter, citing a source familiar with the matter.

The Justice Department has opened its own investigation into Musk's August 7 tweet, in which he said he would take the company private at $420 a share.

Over the weekend, Musk emailed his staff to tell them to "ignore the distractions" and to claim that Tesla is "very close" to finally becoming profitable.

The SEC lawsuit charging Elon Musk with misleading investors sparked a settlement resulting in Musk hiring a new chairperson and two new, independent board members.

While the 15-year-old company has never earned an annual profit, Tesla's CEO has vowed it's the verge of making money and stemming cash burn that's exceeded more than $1 billion in recent quarters.

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