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Musk: No S-E-X for Tesla

When devising a name for an upcoming Tesla model, chief executive Elon Musk flirted with one idea in particular—S-E-X.

"A friend asked me at a party, 'Hey, what are you going to call the third-generation car?'" Musk told shareholders Tuesday. "Well, we got the S and the X--we might as well make it the E. And then it kind of stuck, even though we were just kidding."

The company then filed an application for the name Model E. Already down the rabbit hole, Musk considered trademarking the Model Y, "just for laughs".

"Things are pretty dry in the trademark world," he said, and no one seemed to catch on to Tesla's, um, proposition.

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But, he said, Detroit giant Ford came calling and said it would sue if Tesla used the name.

"And we were like, 'Ford's killing sex,'" Musk said. "That's terrible."

The reasons Ford allegedly tried to block the maneuver are unclear, but it has also reportedly tried to trademark the Model E name. It also has a line of commercial vans called the E-Series, and many of its earliest cars did have names such as the Model A, Model F, and the legendary Model T.

In an email to CNBC, Ford said Tesla had agreed in 2010 not to use or register the Model E name. According to the statement, Tesla later applied for a trademark anyway and Ford then insisted that Tesla honor the earlier agreement. "The matter has been resolved amicably," Ford said.

Read MoreTesla CEO Elon Musk plans to stay at least another 4-5 years as chief executive

So Musk and company backed off and came up with something else.

"The [trademark] applications are in process, so I can't say what they are, but I think we got something that might work out pretty well," he said.

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