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Tesla Is Doing Much Better Than Headlines Suggest

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Re: Tesla Is Doing Much Better Than Headlines Suggest

#41

Post by superfrank »

This article seems to be saying that Tesla is in a good place because they build good, popular cars and electric vehicles are the future.

Maybe, I'm reading different news stories than the author, but I don't feel like those are criticisms of Tesla that I'm seeing anymore. Pretty much every current news story I'm seeing is either focusing on Tesla running out of money because their cars aren't profitable enough, or the fact that Elon's behavior on Twitter is hurting the company. The author addresses neither of these points.

Sure, maybe a few years ago I could get behind the idea that the Koch bothers are spending billions of dollars to try and suppress the electric car industry. But currently, pretty much every major car company has some sort of electric offering and many are making commitments to be fully electric in the near future. Even if the Koch's are spending money to hurt the electric car industry, it seems like they are fighting a losing battle.

Honestly, this whole article reads like a straw man argument.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#42

Post by bfwi »

JumpCrisscross wrote: post #32
bfwi wrote: post #26

Earlier quoted context omitted.

Why is the Tesla stock illiquid? It's publicly traded. I'm sure he could sell SpaceX stock on the secondary market quite easily. SpaceX has never lacked in interest from investors.

> Why is the Tesla stock illiquid? It's publicly traded. Pardon me, imprecise phrasing. SpaceX stock is illiquid. Tesla stock is liquid, but if Tesla is having financial difficulties its stock will go down. If Elon can sell Tesla shares, Tesla can sell Tesla shares. > I'm sure he could sell SpaceX stock on the secondary market quite easily Not "quite easily". One, he's a super material insider. That makes the process…

I'm not convinced that selling some of his SpaceX stock on the secondary market is difficult, or that selling some of his Tesla stocks would cause a rout, especially when the immediate consequence would be paying back the debt, thereby saving the company.

But I hope some experts (e.g. stock analysts) would comment on this scenario, I think it's interesting.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#43

Post by smogcutter »

tssva wrote: post #34
throwaway2016a wrote: post #3

I actually really want to buy a Model 3 but these stories that Tesla has a bridge note due in March that they may not be able to cover have me concerned. If I buy a car I want to make sure the company is around to service it. I don't see this article covering that particular article. In fact the word "debt" appears nowhere in it. Edit: I'm actually asking someone to prove the debt issue wrong if they can. It is liter…

The note due in March is convertible. They can cover it with cash, issuing stock or a combination of the two. It should be a concern for stock owners because it might mean dilution of their position but shouldn't be a concern as far as being a company ending event.

And presumably that risk is already priced in to the stock. It's not as if investors will be caught be surprise.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#44

Post by jonknee »

Anyone who has eyes can see that there are lots of Tesla vehicles on the streets wherever there are lots of wealthy people. That has never been a question or something that headlines suggest. The problem is Tesla sells these cars for less than it costs to build them and have had trouble making enough of them with a build quality matching the luxury price tag. Short sellers will magically go away if Tesla can start to consistently make money by selling cars, until then nothing matters.

If you haven't read it already, don't waste time reading this article.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#45

Post by JumpCrisscross »

bfwi wrote: post #42
JumpCrisscross wrote: post #32

Earlier quoted context omitted.

> Why is the Tesla stock illiquid? It's publicly traded. Pardon me, imprecise phrasing. SpaceX stock is illiquid. Tesla stock is liquid, but if Tesla is having financial difficulties its stock will go down. If Elon can sell Tesla shares, Tesla can sell Tesla shares. > I'm sure he could sell SpaceX stock on the secondary market quite easily Not "quite easily". One, he's a super material insider. That makes the process…

I'm not convinced that selling some of his SpaceX stock on the secondary market is difficult, or that selling some of his Tesla stocks would cause a rout, especially when the immediate consequence would be paying back the debt, thereby saving the company. But I hope some experts (e.g. stock analysts) would comment on this scenario, I think it's interesting.

> I'm not convinced that selling some of his SpaceX stock on the secondary market is difficult

Selling SpaceX stock is not difficult per se. The CEO selling his SpaceX stock for the purpose of purchasing shares in a public company, of which he is also the CEO, is. (Source: this is what I do for a living.)

> selling some of his Tesla stocks would cause a rout

Elon Musk selling his Tesla stock to buy new Tesla shares, thereby giving Tesla cash, wouldn't be a problem. (Though it's a roundabout way for Tesla to issue new shares.) Elon Musk selling his SpaceX stock to buy new Tesla shares would be. It shows Tesla was unable to raise capital in the stock markets.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#46

Post by jaawn »

peeters wrote: post #39
jaawn wrote: post #28

Earlier quoted context omitted.

Which models did you look at? I don't remember a lot of models that are new to the market recently. I checked the Mazda CX-3 and the Nissan Leaf, and the Model 3 does appear to have crushed both of those based on first year numbers.

It's a lot harder to quantify "ramp-up" for these models too, because they almost never have a bare starting point. E.g. CX-3 is (IIRC) based on the Mazda2 platform, so do you include the preceding Mazda2 ramp-up in the number? Still it's the pro-Tesla person that's making the claim; the onus is on them to provide the numbers or if it's not a fair comparison, to avoid it (or clarify it).

I guess that is fair, but according to this carsalesbase.com site, it isn't even remotely close. Tesla has built/sold more Model 3s in its first year of production than anything else I can find...by a lot. They built/sold more in the past few months than entire years for all of the other models I have checked.

That's why I asked what models the other person looked at because so far all of the information I can see from the site that they linked confirms the "pro-Tesla" person's statements.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#47

Post by microtherion »

MrEfficiency wrote: post #23
lozaning wrote: post #14

Earlier quoted context omitted.

I hope Tesla succeeds, but I cant deny I'd love to pick up a 3 on the super cheap because Tesla went belly up.

This sounds good until you realize you bought a first generation vehicle(unreliable parts) and a company that is no longer producing them.

But surely Tesla's vast dealer network would remain available to perform any maintenance for the indefinite future .

Re: Tesla Is Doing Much Better Than Headlines Suggest

#48

Post by w1 »

bfwi wrote: post #35
w1 wrote: post #31

Earlier quoted context omitted.

Just did some rough math on this. He's reported to have 55% of SpaceX, recently valued at 27.5B [1], and ~19% of Tesla [2], most recently at ~44B, for a combined net worth of ~23B (before any debt). He therefore definitely couldn't personally buy out Tesla at current prices, and any significant investment of personal funds would require the sale of SpaceX shares. Also, much of his liquid pocket money has come from lo…

Thanks for the facts. You state that he can't buy out Tesla, which is true. But why does he need to buy out Tesla to cover their debt? On the contrary he would need to sell some of his Tesla (and perhaps SpaceX) stock and give the cash to Tesla to cover their debt.

Those are really good questions. I don't know what form a transfer of cash from Elon to Tesla like that would take. Tesla issuing new shares for him to buy?

Honestly, on paper there isn't any reason why Tesla can't just sell additional shares to the market in general, not necessarily just to Elon, in order to get enough money to cover their upcoming debt payments. Elon has publicly said he won't sell shares because Tesla won't need the money because it will be profitable[1], but some people are skeptical [2]. Maybe he just doesn't want to walk back his statement?

Also as previously mentioned, he can't sell all of his Tesla stock without paying back some of his personal loans.

[1] https://www.cnbc.com/2018/08/01/musk-says-tesla-wont-be-sell...

[2] https://www.businessinsider.com/teslas-upcoming-debt-payment...

Re: Tesla Is Doing Much Better Than Headlines Suggest

#49

Post by adamkittelson »

They're really struggling with delivery logistics though. I was scheduled to pick up my Model 3, which will be my 3rd Tesla, this Wednesday.

I've been hounding them for my bill of sale because the bank needs it before they'll send a check. I called the local delivery center again this morning and they informed me they gave my car to another customer. They didn't bother to let me know about this or the home office so they could begin looking for another VIN to assign to me. Apparently I was just supposed to show up on Wednesday and find out they didn't have a car for me then. I've also already taken out insurance for the VIN they gave me and provided it to my bank so now I have to redo all that whenever they get around to giving me another VIN and hope they don't give that car away too.

My first two delivery experiences were great but now I'm starting to think I'd get a better experience working with a traditional dealership.

Re: Tesla Is Doing Much Better Than Headlines Suggest

#50

Post by jaawn »

pkulak wrote: post #29
sokoloff wrote: post #13

> Tesla has achieved enormous results in ramping up its Model 3 production faster than almost any new model car in history. That defies my gut feel, so I checked on carsalesbase to confirm/refute. Nearly any new car model that I look at far outsells the Model 3 during new model ramp up... http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-...

Yeah, I'd imagine a new Rav4 or CR-V model goes from 0 to 10,000 a week pretty damn fast and with little to no fanfare.

That isn't a "new" model with all of the uncertainty that goes along with it though. Rav4 and CR-V have established reputations, entrenched supply chains, etc... A better comparison would be brand new models, not refreshed old models.
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