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Tesla Was Cash Flow Positive Last Week, CEO Musk Says

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Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#21

Post by nicholassmith »

rikf wrote: post #7
j2bax wrote: post #6

Earlier quoted context omitted.

Considering what he's up against in the industry, I'd say what he's done is fairly remarkable. My concern would be that if at any point one of the big three see Tesla as a threat they will put efforts into creating an electric car that undercuts Tesla's offerings and catapults Tesla into a high end niche oblivion. That said, if it comes to that, I will see that as a different means to the same end of reducing our gas…

I think you would be surprised I think Tesla's strategy has three stages. 1) Niche high cost vehicle sold in low volumes(Roadster) 2) Medium cost luxury vehicle sold in medium volumes(Model S) 3) Low cost high volume vehicle sold in high volumes. (Model ???) Obviously this is a gross over simplification but I imagine that part of the engineering that is going on at TESLA is figuring out how to build 3 cheaper and at…

The simple answer is they'll make a Model S but smaller, but that might be dependent on battery tech improving so they can fit the batteries into the reduced space. FWIW the Model S is at a reasonably decent price for what it is, and I don't think they're too worried about going mass market until the market is ready in terms of infrastructure, acceptance etc.

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#22

Post by [deleted] »

j2bax wrote: post #11
rikf wrote: post #7

Earlier quoted context omitted.

I think you would be surprised I think Tesla's strategy has three stages. 1) Niche high cost vehicle sold in low volumes(Roadster) 2) Medium cost luxury vehicle sold in medium volumes(Model S) 3) Low cost high volume vehicle sold in high volumes. (Model ???) Obviously this is a gross over simplification but I imagine that part of the engineering that is going on at TESLA is figuring out how to build 3 cheaper and at…

I am aware of their strategy, I just worry that the big automakers with their massive distribution and infrastructures already in place could easily come in and be 10 steps ahead of Tesla and provide a vehicle that isn't as sexy but has the same appeal to the electric car market. I could be overestimating their ability to innovate after so many years of sitting on the same old tired technology, but something tells me…

[deleted]

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#23

Post by nicholassmith »

twoodfin wrote: post #20
stephenhuey wrote: post #5

Great news! Here's hoping they're able to place superchargers across the country within a year as planned. As much as one part of me wants to see Elon Musk succeed just to prove Romney wrong for calling Tesla a loser, it's more important to see Tesla do well for the benefits we may reap from companies like this trying to make better solutions and provide excellent competition to the status quo. That being said, I'm f…

Just for future reference, what's the benchmark for calling Romney's prediction accurate? Do they have to liquidate or is it enough that they fail to be able to continue to independently deliver cars to the market? I'd love it if Tesla would succeed sheerly because their product seems so slick, but I agree with Romney that the government is a lousy institution to be picking companies that "should" get half-billion do…

Governments for the most part can take long term(ish) views on things, whereas other investors might be more bullish about seeing a return a lot quicker, for better or for worse. Even traditional bank based investment wouldn't have worked, so it's unlikely something like Tesla would be able to get off the ground and get running.

If Tesla does succeed the US Government gets a nice feather in the cap as well, if it goes horrifyingly wrong then, well, there's already a couple of trillion in the hole, what's another half a billion between friends.

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#24

Post by arethuza »

alxndr wrote: post #17
j2bax wrote: post #11

Earlier quoted context omitted.

I am aware of their strategy, I just worry that the big automakers with their massive distribution and infrastructures already in place could easily come in and be 10 steps ahead of Tesla and provide a vehicle that isn't as sexy but has the same appeal to the electric car market. I could be overestimating their ability to innovate after so many years of sitting on the same old tired technology, but something tells me…

"the big automakers ... could easily come in and be 10 steps ahead of Tesla and provide a vehicle that isn't as sexy but has the same appeal to the electric car market" Aren't they already trying to do that? Chevy's Volt, Nissan's Leaf, Ford apparently makes a fully PEV Focus now, as does Honda with a version of the Fit, and Toyota's gotta be working on the Prius...

Not to mention European car makers that aren't well known in the US such as Renault and Peugeot Citroën.

Renault have a small electric hatchback going on sale in the spring in the UK at £13,650 (including a grant):

http://www.telegraph.co.uk/motoring/car-manufacturers/renaul...

Personally, I'd be far more likely to buy a small electric hatchback than any of the Tesla models.

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#25

Post by jamiequint »

j2bax wrote: post #11
rikf wrote: post #7

Earlier quoted context omitted.

I think you would be surprised I think Tesla's strategy has three stages. 1) Niche high cost vehicle sold in low volumes(Roadster) 2) Medium cost luxury vehicle sold in medium volumes(Model S) 3) Low cost high volume vehicle sold in high volumes. (Model ???) Obviously this is a gross over simplification but I imagine that part of the engineering that is going on at TESLA is figuring out how to build 3 cheaper and at…

I am aware of their strategy, I just worry that the big automakers with their massive distribution and infrastructures already in place could easily come in and be 10 steps ahead of Tesla and provide a vehicle that isn't as sexy but has the same appeal to the electric car market. I could be overestimating their ability to innovate after so many years of sitting on the same old tired technology, but something tells me…

> I just worry that the big automakers with their massive distribution and infrastructures already in place could easily come in and be 10 steps ahead of Tesla and provide a vehicle that isn't as sexy but has the same appeal to the electric car market.

I really doubt this. This is the classic innovators dilemma. The investments in electric don't look good enough yet for the car companies to go "all in". Their entire supply chain is built around making and selling cars that run on gas engines. Tesla isn't beholden to any kind of entrenched thinking and thus can build up an advantage here that is going to take the big car companies a while to catch up to once electric cars go mainstream. (http://dl.dropbox.com/u/120/Screenshots/innovators_dilemma_c...)

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#26

Post by BCM43 »

perry5000 wrote: post #10
w1ntermute wrote: post #3

Earlier quoted context omitted.

That's rather disingenuous. Musk is selling an innovative product worth tens of thousands of dollars to individual consumers. Considering the engineering that had to go into making the Model S a reality, I would consider this very impressive. Moreover, there is no reason to think that Tesla will not continue to increase in profitability with each passing week.

Cash flow positive != profitable

What does it mean?

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#27

Post by pm90 »

twoodfin wrote: post #20
stephenhuey wrote: post #5

Great news! Here's hoping they're able to place superchargers across the country within a year as planned. As much as one part of me wants to see Elon Musk succeed just to prove Romney wrong for calling Tesla a loser, it's more important to see Tesla do well for the benefits we may reap from companies like this trying to make better solutions and provide excellent competition to the status quo. That being said, I'm f…

Just for future reference, what's the benchmark for calling Romney's prediction accurate? Do they have to liquidate or is it enough that they fail to be able to continue to independently deliver cars to the market? I'd love it if Tesla would succeed sheerly because their product seems so slick, but I agree with Romney that the government is a lousy institution to be picking companies that "should" get half-billion do…

Well, they are not the same thing but: the govt. did invest in creating the ARPANET, and the DOE still counts as one of the largest customers of supercomputers. If the Govt. invests in new tech. areas that the private sector is unwilling/unsure of investing for the purpose of pushing the industry ahead, I don't really see anything wrong with that.

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#28

Post by jlgreco »

twoodfin wrote: post #20
stephenhuey wrote: post #5

Great news! Here's hoping they're able to place superchargers across the country within a year as planned. As much as one part of me wants to see Elon Musk succeed just to prove Romney wrong for calling Tesla a loser, it's more important to see Tesla do well for the benefits we may reap from companies like this trying to make better solutions and provide excellent competition to the status quo. That being said, I'm f…

Just for future reference, what's the benchmark for calling Romney's prediction accurate? Do they have to liquidate or is it enough that they fail to be able to continue to independently deliver cars to the market? I'd love it if Tesla would succeed sheerly because their product seems so slick, but I agree with Romney that the government is a lousy institution to be picking companies that "should" get half-billion do…

It is important to remember that if you think that, your beef should be with the government not the company that accepted it. I think to many people have taken their own disapproval of such programs to be a legitimate criticism if Tesla.

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#29

Post by brandall10 »

tjic wrote: post #2

While I'm a huge fan of Elon Musk, and I even think Tesla is pretty cool, I'm a little underwhelmed. Every one of my ventures could be cash flow positive if I got a half BILLION dollar loan from the taxpayers and then was able to sell my product with a $8k tax credit stapled to the side of each unit. http://techcrunch.com/2009/06/23/the-government-comes-throug...

Do you have any idea whatsoever how hard it is to have a successful venture in the automotive industry?

You really should watch the Bloomberg Risk Takers documentary on Elon. I'm against handouts as much as anyone (it's a loan though), but try making a comment like this afterward.

The difficulties he went thru to keep Tesla afloat were outrageous. By this time he been dumping his fortune into both this and SpaceX and was essentially at the point of personal bankruptcy (ie. was friends/associates time to keep moving, no one was willing to continue investing). Note in the article the sentence "Last month, Mercedes’ parent company Daimler also invested $50 million for a 10 percent stake in Tesla." Do yourself a favor and learn what Tesla actually did to make this happen. Yes, you may have heard they retrofitted Smart Cars with the Tesla power train, but how they did that is a breathtaking example of innovation and teamwork for a company at the brink of death.

In short, this loan saved the company. This article we're discussing right now would not exist. Tesla Motors would be another footnote in history that people could point to - "automotive startups are a losing proposition, do not invest". Would you rather the government bet on a guy like Elon who's actually putting his all into carrying out on a promise to change the game, or industry stalwarts who pissed away good will by incompetence and greed?

Re: Tesla Was Cash Flow Positive Last Week, CEO Musk Says

#30

Post by jervisfm »

perry5000 wrote: post #10
w1ntermute wrote: post #3

Earlier quoted context omitted.

That's rather disingenuous. Musk is selling an innovative product worth tens of thousands of dollars to individual consumers. Considering the engineering that had to go into making the Model S a reality, I would consider this very impressive. Moreover, there is no reason to think that Tesla will not continue to increase in profitability with each passing week.

Cash flow positive != profitable

What is the difference between the two ? Don't you need to have a net positive flow in order to be profitable ?
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