The CEOs of Tesla and JPMorgan have been throwing remarks — and lawsuits — at each other since 2016. But their relationship has improved since March, people close to the duo told the Wall Street Journal.
In March, Musk attended a JPMorgan technology summit in Big Sky, Montana, and the two executives spoke for an hour on stage about artificial intelligence and policy, the Journal reported. Musk also visited Dimon’s suite at the resort and stayed there for over an hour.
After the event, Dimon decided his bank might try to start doing business with Musk again, people familiar with the matter said. An update would be a win-win: Musk would have access to financing and advice from the largest bank in the United States, and JPMorgan would have the opportunity to working with the serial entrepreneur’s many businesses.
The relationship first deteriorated in 2016 when the investment bank backed out of underwriting leases for Tesla’s cars. Its bankers did not know how to assess the lifespan of electric vehicle batteries. This drove Musk crazy. He called the bank’s head of consumer banking, swore at him and threatened to shut down Tesla’s business. Dimon called back and said his bank would not be bullied, the Journal reported.
From that point on, Musk truly took his business elsewhere. He relied more on Goldman Sachs and Morgan Stanley, who were already Tesla’s main advisors. Goldman helped take the automaker public in 2010 and was Musk’s first choice when he tried to take the company private again in 2018. According to the financial data firm Dealogic, Goldman has received nearly $90 million in fees from Tesla and SpaceX, another Musk company, since 2010.
To make matters worse, JPMorgan sued Tesla and Musk for more than $162 million in 2021. The bank said Tesla “blatantly” violated a 2014 contract signed by the two companies regarding warrants sold to the bank. JPMorgan said Musk’s tweet about taking the company private spoiled the market. Tesla hit back, saying the bank was angry because it was excluded from Musk’s business and that JPM executives had animosity toward their boss.
In November, Dimon spoke about the lawsuit at a New York Times conference and said, “We think we’re owed money for something and they say no, and it’s in court and we We’ll win.”
Both trials are ongoing.
businessinsider
