Tesla will remain a public company after Elon Musk announced he has given up plans to take it private.

Mr Musk had been looking to privatise the electric car and solar panel company to avoid the short-term pressures of reporting quarterly results, and give the company time to work on bigger, bolder ideas.

Earlier in August, Mr Musk said funding had been secured for the privatisation deal, pending some details still to be worked out with Saudi Arabia's Public Investment Fund.

His tweets about the deal triggered an investigation over possible stock price manipulation.

The stock price was dealt a US$4.5 billion blow shortly after, when Mr Musk gave an interview in which he admitted to suffering under the stress of running the company.

This week, Mr Musk said he had secured more than enough funding to take Tesla private, but after meeting with the company’s board he has now decided otherwise.

“Given the feedback I've received, it's apparent that most of Tesla's existing shareholders believe we are better off as a public company,” Mr Musk said in a statement.

Reports say a significant part of the decision is due to the fact that institutional investors have internal rules limiting how much they can sink into a private company.