April Fools’ Day Prank: When Tesla Tricked All By Announcing ‘Model W’ And Its Stock Jumped
A press release issued by Tesla Motors on April 1, 2015, which is still available on its website, made certain claims about its product, a watch, which should have raised red flags, but did not.
It has been a tradition for companies and media publications to play practical jokes on April Fools’ Day. On several occasions in the past, people have been played pranks on or tricked into believing something that was only meant to be a joke.
So, if you hear a great new product announcement on April 1, especially if it sounds too good to be true, the general advice would be to take it with a pinch of salt. In 2015, one such announcement by electric car maker Tesla Motors fooled many when it announced that the company was introducing a line of watches, called the ‘Model W’.
A press release issued by the company on April 1, 2015, which is still available on its website, made certain claims that should have ideally alarmed people, but did not.
This is what the press release said about ‘Model W’: “It is infinitely adjustable, able to tell the time no matter where you are on Earth. Japan, Timbuktu, California, anywhere! This will change your life. Reality as you know it will never be the same.”
The statement also said: “No longer will you need to rudely examine your phone to read text messages. Now you can politely stare at the tiny screen on your wrist without anyone noticing.”
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Tesla’s Stock Jumped Within First Minute Of Model W Announcement
The Tesla press release even said, quite cheekily, the new watch was “in no way a competitive response to what some other company is doing”, as the statement came close on the heels of the announcement by Apple that it was going to launch a computerised wrist watch that April, which would be called Apple Watch.
In fact, the opening lines of the release said: “Tesla today announced a whole new product line called the Model W. As many in the media predicted, it's a watch. That's what the ‘W’ stands for.”
It went on to make fun of the Apple product, which calls itself "the ultimate device for a healthy life", by saying: “Studies have shown the Model W will dramatically improve your health. If you work out. And it's available in platinum!”
All this evidently did not raise a red flag, as financial traders just fell for the headline that read “Announcing the Tesla Model W”.
According to a CNBC report from that day, Tesla’s stock jumped within the first minute of the announcement, which came when about five minutes were remaining in the trading day. Reuters reported that nearly 400,000 shares traded in that one minute as the stock jumped about 0.75 percent to as high as $188.50.
The Reuters report said Tesla admitted in an email that its statement was indeed an April Fool’s Day prank.
The company, in fact, made not one but two such announcements on the day, the report said. The other prank was a video that promoted a new self-driving car that helped its Model S riders to evade tickets for traffic and parking violations. Check out the video:
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