There was another bit of bad news for US based electric car maker on Wednesday after reports revealed that its Chinese rival electric car maker Nio has received investments from Tesla’s one of the largest shareholders – Baillie Gifford. The news resulted in a fall in eth shares of the Tesla in early trade on US markets.
11.44 per cent stake in the Chinese electric car making company Nio is owned by Edinburgh-based Baillie Gifford through ownership of about 85 million shares of the company, revealed a regulatory filing on Tuesday.
Deliberations and concerns among investors that confidence in Tesla, led by billionaire entrepreneur Elon Musk, was being lost by Baillie Gifford resulted in a loss of about 5 per cent in the shares of Tesla following the revelation of the news of the investment.
According to a revelation of James Anderson, one of the partners of the fund manager, last month, Baillie Gifford was not sure that Tesla would “make a lot of money” for the clients of the fund.
“There is still a good possibility that Tesla will prove entirely and highly successful and the returns we make to that would outweigh the downside involved in all these complex tasks not working out,” he said in an interview with CityWire.
“But I think one should always try to phrase things in terms of probabilities and payoffs rather than certainty. We think there is a chance that we can make a lot of money for our clients in exercising this vision, which is surely good for the world, but are we certain about it? No, of course not.”
Baillie Gifford us the largest stakeholder outside of Tesla as the fund only has lesser number of shares in the business than what is held by Elon Musk in the company.
The Chinese rival of Tesla Nio had made its debut in the US market and raised about $1 billion and this huge investment comes about a month after that move by the Chinese company. However the share price of the company has seen a seesaw ride with it falling as low as $5.35 a share after giving risen to $13.80 in the last one month.
The Chinese electric car maker has defined itself to be the ‘Tesla of China’ and has plans of entering the US and European market after it establishes its operations in China.
On the other hand, the shares of Baillie Gifford rose by more than 13 percent on Wednesday after the revelation of the news about the interest of the fund in the Chinese electric car maker.
(Adapted from Telegraph.co.uk)