(Reuters) - Tesla Inc on Thursday announced plans to raise $2 billion in a stock offering, tapping into an astronomical jump in its share price over the past few months and reversing the electric-car maker’s often-stated policy of avoiding sales of new stock.

Tesla said it would offer 2.65 million shares, of which Chief Executive Officer Elon Musk will buy up to $10 million in shares, while board member and Oracle co-founder Larry Ellison will purchase up to $1 million worth of Tesla shares.

Tesla’s shares were down roughly 1% in morning trading, retracing losses after sliding as much as 7% in premarket trading. The stock has tripled since October when the company posted a rare quarterly profit. Its market capitalization now exceeds the combined value of General Motors Co and Ford Motor Co.

Musk has repeatedly assured investors that Tesla will not need to raise more money for costly initiatives including production of a new vehicle model, the ramp-up of its China production and the construction of its first European factory.

“It doesn’t make sense to raise money,” Musk said during a Jan. 29 earnings call when an investor asked why Tesla does not take advantage of its favorable share price to accelerate production. Musk said the company would generate enough cash on its own to fund ambitious expansion plans.

“Diluting the company to pay down debt doesn’t sound like a wise move,” Musk said on the same call.

Musk also said Tesla needed to produce more batteries to increase vehicle production, adding that some projects like its electric semi-trailer truck program could not proceed without battery improvements.

Tesla is also working on an electric pickup truck, a new generation of the Tesla Roadster, an electric sports car, and automated driving features. The company did not immediately respond to a request for further comment on how to reconcile Thursday’s announcement with Musk’s previous statements.

The decision to raise money will come as a shock to some investors following Musk’s previous comments, Wedbush analyst Daniel Ives said in a note.

“In our opinion the size of this offering is larger than many had anticipated, but we believe it’s a smart move by Musk and the Board to take advantage of being back in a position of strength,” Ives said.

Tesla, whose outstanding debt was $13.42 billion at the end of 2019, posted its second quarterly profit in a row in January and said it would comfortably make more than half a million cars this year.

The company said it plans to use proceeds from the offering to strengthen its balance sheet and for general corporate purposes.

Tesla raised about $2.3 billion in May to start production in China and spend on developing new models, including the high-volume Model Y SUV and a Semi commercial truck, whose launch has been delayed due to a lack of battery production capacity.

Since the last capital raise, Tesla has built a $2 billion factory in Shanghai and unveiled the futuristic Cybertruck pickup. The Shanghai factory started delivering cars last month.

Goldman Sachs and Morgan Stanley are the lead joint book-running managers. Barclays, BofA Securities, Citigroup, Credit Suisse, Deutsche Bank Securities and Wells Fargo are additional book-running managers.

The underwriters will get an option to buy up to $300 million in additional shares.