How Concerned Should Tesla Investors Be About Its Multibillion-Dollar Legal Exposure?
Mounting litigation exposure is a topic for investors to keep in mind, but Tesla also has a massive cash and liquidity cushion.
Overview
For all Tesla (NASDAQ: TSLA) has achieved, and it has achieved much over the past decade plus, it faces numerous near-term challenges. Global competition is only intensifying in the electric vehicle (EV) industry, its product lineup is aging despite still selling well, and price cuts have hindered profit margins. For investors still considering investing in Tesla long-term, there is another potential speed bump in the road ahead: the company's mounting litigation exposure.
There was a recent development that many investors overlooked: Tesla has confidentially settled with three of five named plaintiffs in a racism lawsuit that has been on the company's radar for nearly a decade, since 2017. In the grand scheme of that lawsuit, it doesn't change a whole lot, and there are still nearly 600 workers involved with serious allegations. Investors can't forget that California's civil rights agency has its own case, too.
Image source: Tesla.
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Originally published at www.fool.com.