Why almost everyone was wrong about Tesla’s cash flow situation • Hacker News Board

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#61

Post by pow_pp_-1_v » Fri, Oct 26, 2018, 2:57 PM UTC

anoncoward111 wrote: post #3

Serious question, and I'm not a Tesla hater either: Why does anyone spend $35,000 - $50,000 on a car? It just feels like a number that is at least 5x too high. A used car from a fairly reputable source can be had for between $3,000 - $6,000, depending on mileage and cosmetic appearance. My 2005 Ford Focus sedan was $3,000 and should last me about 3 years before I need to make a decision about major repairs, so that's…

Well, a couple of weeks back, I bought a car. I would have bought if 35K Model 3, if one was available. Why? Because I didn't want to burn gas when there might be other options available; because I wanted to do my part in keeping an electric vehicle company alive; because I wanted to be less of an asshole to the future generations that have to live with the consequences of things we do now.

Yes, I know most of electricity is still generated from fossil fuel sources. But baby steps.

Btw, I ended buying a Honda Insight.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#62

Post by kitsunesoba » Fri, Oct 26, 2018, 2:57 PM UTC

zeptomu wrote: post #35

anoncoward111 wrote: post #3

Serious question, and I'm not a Tesla hater either: Why does anyone spend $35,000 - $50,000 on a car? It just feels like a number that is at least 5x too high. A used car from a fairly reputable source can be had for between $3,000 - $6,000, depending on mileage and cosmetic appearance. My 2005 Ford Focus sedan was $3,000 and should last me about 3 years before I need to make a decision about major repairs, so that's…

It is true that at the moment a conventional (non-electric) vehicle is cheaper. However some people do want to own a car that has a lower negative impact on the environment and are willing to pay more money for that (which is a good thing).

This is a factor for me. I’ve never owned a car and if I can help it, want to avoid ever buying an ICE or partially-ICE vehicle. There’s a tiny used EV market, but it’s mostly filled with early entrant models that make serious compromises, making buying from it somewhat impractical.

So I’m now considering buying a model 3 in the next 1-2 years. If I can’t make it work financially, I’ll just make do without a car until that changes.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#63

Post by paulddraper » Fri, Oct 26, 2018, 2:57 PM UTC

ams6110 wrote: post #42

madeuptempacct wrote: post #15

Earlier quoted context omitted.

"Why does anyone spend $35,000 - $50,000 on a car? It just feels like a number that is at least 5x too high." If someone makes $250,000+ a year, it's not unreasonable. "My 2005 Ford Focus sedan was $3,000 and should last me about 3 years before I need to make a decision about major repairs, so that's less than $100 a month in ammortized costs." That's completely unrealistic. You have some sort of competitive advantag…

Not at all. You can buy a good, reliable, well maintained car for $3,000. Mileage is less important than maintenance history. The Focus is a particularly good choice IMO. They are reliable, pleasant to drive, and Ford made gazillions of them so you can get them repaired anywhere and parts are cheap. You can also buy a basket case for $3,000, so you do need to have a bit of an idea of what to look for (or what to avoi…

Please link to this good, reliable, well-maintained car for $3k or under, because (without a family/buddy deal) it does not exist.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#64

Post by dsfyu404ed » Fri, Oct 26, 2018, 2:57 PM UTC

wbrasky wrote: post #12

anoncoward111 wrote: post #3

Serious question, and I'm not a Tesla hater either: Why does anyone spend $35,000 - $50,000 on a car? It just feels like a number that is at least 5x too high. A used car from a fairly reputable source can be had for between $3,000 - $6,000, depending on mileage and cosmetic appearance. My 2005 Ford Focus sedan was $3,000 and should last me about 3 years before I need to make a decision about major repairs, so that's…

I am equally baffled by people's love of throwing money at cars. When I needed a "new" car two years ago, I asked my mechanic what sort of car they would want from a reliability/value standpoint. I was told Subarus or Toyotas not later than about 2007 were very nice. I spent 3 months watching used listings and wound up with a very low mileage 2006 Rav4 (for ~$10k) and it has been wonderful.

>I spent 3 months watching used listings and wound up with a very low mileage 2006 Rav4 (for ~$10k) and it has been wonderful.

People think used Toyotas are made of gold. You could almost have a different Tahoe (in equivalent condition) for each day of the week at that price point.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#65

Post by ansible » Fri, Oct 26, 2018, 2:59 PM UTC

kevin_thibedeau wrote: post #56

samfisher83 wrote: post #9

Earlier quoted context omitted.

Because someone wants a nice car. You are spending a couple hours a day in your car so if it small, cramped, slow, vibrates a lot why would you subject your self to that especially if you have disposable income.

> You are spending a couple hours a day in your car Most people don't have 1 hour commutes.

Maybe not most, but a lot of people do.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#66

Post by isoskeles » Fri, Oct 26, 2018, 3:01 PM UTC

anoncoward111 wrote: post #3

Serious question, and I'm not a Tesla hater either: Why does anyone spend $35,000 - $50,000 on a car? It just feels like a number that is at least 5x too high. A used car from a fairly reputable source can be had for between $3,000 - $6,000, depending on mileage and cosmetic appearance. My 2005 Ford Focus sedan was $3,000 and should last me about 3 years before I need to make a decision about major repairs, so that's…

I am not a car fanatic like these people, but I think I get it. Some people just love cars, like how some people love gaming rigs or skiing. They love the things so much they’re willing to go into debt.

Part of the phenomenon may be branding too. Cars are used as a status symbol. It’s not necessarily used to broadcast that you’re a “better” person than others, but maybe that you have “good taste” and “can afford it” (think something like expensive designer handbags but more functional).

And some people are just dopes who spend money or go into debt with thinking about it. They’re financially illiterate. These are people who make emotional purchases and feel very excited and happy about their new car, who gripe about their debt two months later when reality sinks in. I feel bad for them.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#67

Post by newguynewguy » Fri, Oct 26, 2018, 3:01 PM UTC

ams6110 wrote: post #42

madeuptempacct wrote: post #15

Earlier quoted context omitted.

"Why does anyone spend $35,000 - $50,000 on a car? It just feels like a number that is at least 5x too high." If someone makes $250,000+ a year, it's not unreasonable. "My 2005 Ford Focus sedan was $3,000 and should last me about 3 years before I need to make a decision about major repairs, so that's less than $100 a month in ammortized costs." That's completely unrealistic. You have some sort of competitive advantag…

Not at all. You can buy a good, reliable, well maintained car for $3,000. Mileage is less important than maintenance history. The Focus is a particularly good choice IMO. They are reliable, pleasant to drive, and Ford made gazillions of them so you can get them repaired anywhere and parts are cheap. You can also buy a basket case for $3,000, so you do need to have a bit of an idea of what to look for (or what to avoi…

I'm going to be replacing a taurus soon. $3k is my budget. I took highschool auto, but would absolutely not feel comfortable buying a used focus.

Where are the resources to learn what I 'need to look out for'?

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#68

Post by dsfyu404ed » Fri, Oct 26, 2018, 3:01 PM UTC

rootusrootus wrote: post #53

billylindeman wrote: post #30

Earlier quoted context omitted.

Sounds like you're a fiscally responsible person. Keep in mind most people are not, and our economy is built on top of easy credit / debt.

It is far from a sure bet that a 15-year-old $3K Ford is the fiscally responsible choice. It's kind of the reverse of the problem of people spending too much on cars -- someone getting focused on the absurdly low price and not factoring in what it will actually end up costing them over time.

The difference in up front cost between an '04 S10 and an '08 Tacoma will put a whole new drive-train in that S10, twice.

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#69

Post by ghaff » Fri, Oct 26, 2018, 3:01 PM UTC

kevin_thibedeau wrote: post #56

samfisher83 wrote: post #9

Earlier quoted context omitted.

Because someone wants a nice car. You are spending a couple hours a day in your car so if it small, cramped, slow, vibrates a lot why would you subject your self to that especially if you have disposable income.

> You are spending a couple hours a day in your car Most people don't have 1 hour commutes.

Many do though. And the average in the US is almost 30 minutes. So change it to an hour per day (and people also drive outside of their commute).

Re: Why almost everyone was wrong about Tesla’s cash flow situation

#70

Post by matwood » Fri, Oct 26, 2018, 3:02 PM UTC

AllegedAlec wrote: post #19

I'm not sure I'm sold on the perspective that the worst Tesla detractors were actually just misinformed or wrong about the subject, rather than being actively malevolent by trying to gain money by shortselling while funding anti-Tesla articles.

I think it's still a little soon to call them wrong. I was long TSLA for quite awhile, and have never been short. TSLA still has financial issues. While this quarter was certainly a positive, it remains to be seen if they can keep it going [1].

When it comes to financial investment I try not to be 'anti' anything. I look at what is. The facts still show TSLA having a bumpy road ahead. The next two quarters will really show if things have turned. First we'll find out if this beat was just a timing beat with cash flow and accounts payable. Next, we'll see how the debt payments coming due are covered.

[1] I see a lot of 3's on the road, so I'm starting to lean back towards probably.