Elon Musk, the CEO of Tesla, responded to JP Morgan Chase’s $162 million lawsuit by threatening the nation’s largest bank with a “one-star review on Yelp.”
According to the lawsuit, JPMorgan accused Musk’s electric vehicle business Tesla of stiffing the bank on a trade that JPMorgan helped arrange in 2014, filed on Nov. 15 in the US District Court for the Southern District of New York, the New York Post reported.
In a statement, JPMorgan said, “We have provided Tesla multiple opportunities to fulfill its contractual obligations, so it is unfortunate that they have forced this issue into litigation.”
Musk replied with a more joking tone.
“If JPM doesn’t withdraw their lawsuit, I will give them a one-star review on Yelp,” Musk said in response to The Wall Street Journal.
“This is my final warning!” he added.
Tesla has captivated the market’s imagination about the future of electric cars, becoming one of the first firms to be valued at more than $1 trillion, making it the type of client that Wall Street battles over.
Typically, bankers avoid public battles with large clients and even potential customers, fearful of losing money and concerned that the slightest insult could cost them access, especially with a business like Tesla. But this is not the case.
Both CEOs have dominating presences within their organizations and sectors. And both have had public spats with competitors or harsh words for critics and authorities, but Dimon has frequently expressed sorrow for what he says are careless mistakes, whereas Musk has seldom backed down.
JPMorgan transaction with Tesla
According to the Journal, JPMorgan worked on Tesla’s IPO in 2010 and several subsequent deals, but the bank was always ranked behind rivals Goldman Sachs and Morgan Stanley.
According to the research, JPMorgan earned around $15 million in the last decade for advising Tesla and negotiating on transactions with the electric vehicle maker. In comparison, rival Goldman earned roughly $90 million in the same time period.
According to public data obtained by the Journal, the bank hasn’t worked with Tesla since 2016.
In his own financial dealings, Musk has shunned JPMorgan in favor of Morgan Stanley, Goldman Sachs, and Bank of America.
According to the Journal, JPMorgan’s consumer bank was hesitant to fund Tesla early on, according to people familiar with the situation, since the bank questioned the long-term feasibility of electric vehicle batteries.
Bank executives later attempted to reach an agreement with Musk in which Chase would become the primary lender to Tesla buyers at dealerships.
Musk declined, and now, JPMorgan struck a deal similar to the one they once sought from Tesla with rival electric truck maker Rivian, the report said.