Saleen Launches Shady Fundraising Effort, Teases Modified Tesla Vehicles Again

Saleen Automotive has launched a sleazy new fundraising effort to bring the company back from the dead, and the legendary auto tuner is once again dangling modified Tesla vehicles in the process.

Saleen’s Troubled History

Saleen is a California-based car tuning company founded by Steven Saleen, a former race car driver turned CEO.

In the late 1990s and early 2000s, he found some success tuning Ford Mustangs. He had a direct relationship with Ford to supply Mustang chassis and many Ford dealerships distributed his Saleen Ford Mustangs. It also launched the Saleen S7 supercar.

At the time, the company was as respected as Roush and Hennessey, who are now considered America’s leading auto tuners. At one point, Saleen even became a contractor for Ford and was awarded the contract to assemble and paint the Ford GT.

However, it did not survive the financial crisis of 2008-2009 and went bankrupt.

A few years later, Steve Saleen tried to revive the company, but he had to use shady financing to make it happen.

The new “Saleen Automotive” was introduced to the penny stock market (OTC) through a shell company owned by a financier named David Weiner, who is known for taking small companies public on the OTC, offering them toxic ratings with ridiculous conversion rates, then dumping those stocks.

After going public and taking millions in convertible notes from these investors, Saleen started making lots of announcements about new projects and even electric vehicles, which caught my attention.

Saleen has announced that it will tune the Tesla Model S to create the Saleen Tesla Foursixteen.

The company has made numerous claims about the vehicle that have never been substantiated. Saleen even claimed to be “in partnership with Tesla” on the project, which was never the case:

Saleen took millions of dollars in customer deposits for the Foursixteen and other vehicles, but ultimately only delivered a few units.

In 2014 and 2015, millions of convertible notes matured and diluted Saleen stock. The investors behind these notes began selling heavily and around the same time Saleen bought advertising on a penny stock website to promote its stock, and several stock sellers began promoting the company:

The new shares were offloaded to small retail investors, who believed Saleen would find success with its modified Tesla vehicles and future electric vehicle projects they were teasing at the time. The stock went from around $1 per share to completely worthless over the next few years, and it was eventually delisted by the SEC after becoming delinquent in its financial reporting.

In 2019, Saleen attempted to revive the business through a partnership with a Chinese automaker, but that failed within a year.

Saleen is back

Now in 2022, Saleen is trying to make another comeback; If the company’s history isn’t enough warning, there are plenty of new red flags with the company’s latest release.

Several people sent Electrek an investment solicitation notice from Steve Saleen:

Saleen is looking for small investors with a minimum of $500 to invest in the business, which essentially amounts to a crowdfunding effort. They are trying to raise a total of around $20 million.

Where things get shady is that people investing in the Saleen offering have to give up their voting proxy to Steve Saleen.

The company wrote in a filing with the SEC:

Investors in this offering will grant an irrevocable voting proxy to the CEO of the Company that will limit their ability to vote their common shares purchased under this offering until the occurrence of certain events specified in the proxy, none of which can ever occur.

In the SEC filing, the company still claims to be trying to fix Tesla vehicles, among other things:

Our Saleen Signature cars are built from base chassis from major US automakers including Ford Mustangs, Ford trucks and Tesla Model S vehicles. We are also working on the development of the Saleen Bronco.

The filing also shows Saleen’s revenue fell 91% last year to just $2.5 million. The company posted a net loss of $3.3 million in 2021. As of the last publication date (September 2021), Saleen had only $14,000 in cash.

Electrek’s Grasp

I first became interested in Saleen in 2014 after announcing their Tesla tuning effort. As a child, I was a fan of the Saleen S7 and was curious about them going electric, but my interest quickly dissipated when I looked at the financial dealings around the company.

To me, everything felt like a classic pump and dump. I published my findings at the time to inform other potential investors, as I expected the stock to become worthless due to toxic convertible notes and there would be no clear path to Saleen to achieve what they claim to achieve with its Tesla tuning effort.

Saleen ended up suing me to shut me up about these transactions.

Last year I broke my silence on the situation and explained everything in detail in a Twitter feed worth reading if you have about 10 minutes:

All the same people are again involved in this new effort to sell Saleen shares years later. I thought it was worth coming back to make sure all the information is there.

As usual, you should do your due diligence before investing in anything.

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