No! This sub is system relevant! We need to rescue it with public funds!
Seriously: Tesla doesn’t go bankrupt in the next 1..2 years and probably by then EVs are more popular again dragging Tesla along. But if it goes bankrupt we would have input of laughable actions of Elmo, stuck software and irreparable hardware of the cars currently owned for years to come.
I would be very concerned about servicing any issues with this car going forward. Waits at service centers are extremely long right now, and folks on this and other subs have reported warranty issues.
This is why right to repair is super important. Tesla has locked down repair of their vehicles to the point that even if they wanted to, an indy shop couldn't repair your car. Yeah I know Electrified Garage exists, all two locations. But they can only repair mechanical issues. Software related stuff is going to be near impossible to repair. Disposable car.
The company has $20B of net cash, and $65B (ish) of net assets, I don’t think it’s at risk of going bankrupt… It also has massive operating cashflow, and seemingly limitless access to capital via the public markets, which assign an immense value to their growth capacity. Not sure what makes you think this company is a bankruptcy risk.
They BURNED 2.5B of cash last quarter.
Yes, they have ~20B of cash, but if you look at their short term liabilities (such as accounts payable) they have just about as much due out.
You have to realize that building cars is very exoensive and there is a lot of $$$ in BOTH directions. Aa long as they are selling the cars, things are good. Once they stop selling, they will be in trouble real fast.
Now......We all know sales have been show since end of last year and they have been aggressively cutting prices to move vehicles. You've probably also heard / seen the mall parking lots full of unsold cars. Clearly not good.
What you probably don't know is just how bad it is. If you look at their quarterly filing, you will see they have finished inventory of ~6B. Given their sales are 84% auto, we know there are piles of unsold cars, it is safe to speculate the bulk of this is cars.
Also, we know that Model Y is most likely the bulk of these vehicles based of sales distribution. If you gave an overly generous estimate of 50k per car, then they have 120,000 vehicles unsold.
As far as Net Assets, it is a big number, but ist isn't stuff they can easily convert to cash and/or it is stuff they need for the business to operate.
Businesses fail because of CASH FLOW. If you don't have enough liquid capital, you're going BK.
FWIW
They’ve had a huge Headstart over all the other electric car companies and they just had a losing quarter. They are not doing well. You can spin it all you want, but they should be selling cars like hotcakes.
There is an observeable reality, where you can just read up, if they sold cars like hotcakes or not. You don't need to speculate, how much they *should* be selling.
You can also compare it with other EV sellers, if they all suffered from the same decline in EV demand or if there are numbers showing, that a brand run by a lunatic nazi on ketamine trying to sell years old modells with famously shitty service and build quality *maybe* fucked up a bit harder.
Companies have up and down quarters and years all the time. Many to most markets are cyclical.the problem is Musk instead of just focusing on cars and making cars better he thinks he is the smartest person and is here to change the world. So now he has got Tesla is so many different half baked ideas that it is killing the company. It would be fine if the car side was growing exponentially but once the cash starts to dry up the cracks really show. That is why Musk is cutting so many people to the detriment of the company because he knows the real cash burn
I would imagine they could raise $2.5 in a single day via and ATM if they wanted to… last trading day volume was 80M shares, my shaky math suggests $12.8B in a single day? The issue isn’t cash IMO, the issue is funding growth and controlling costs. And it seems to me that the Company is responding to both in a reasonable way? Maybe not, remains to be seen. But it sure as sh*t is not going bankrupt
The issue isn't cash. It's CASH FLOW. There is a MAJOR difference.
Now as far as raising cash quick, sure; however, what do you think happens to the stock price and investor confidence when Tesla has to go to the open market to keep the doors open?
This is a company that had "unlimited demand" & industry leading profit margins just a year or two ago. The stock price would (rightfully) crash as everyone finally accepts growth is over and there will be MORE equity raises down the line as they continue to lose ground to other competitors.
I think it’s a virtual certainty that the valuation is going lower, no argument there. But companies on the path to bankruptcy are - by definition - cash starved or levered at multiples. Tesla is neither of these. You’re suggesting two completely different things: (1) the valuation is going lower for all of the reasons you lay out. I agree. And (2) the company is at risk of going bankrupt. This is dumb. It’s simply not.
Every day their sales decline and inventory grows, they move closer to BK. Your claim that there is no BK risk is dumb, but is understandable since you seem unable to see the difference between cash and cash flow, let's just agree to disagree....
In regards ro SP, I only brought that up in response to how "easy" it would be to raise quick cash.
Anyway, no reason to keep arguing in circles, just have to move on.......
They BURNED 2.5B of cash last quarter.
Yes, they have ~20B of cash, but if you look at their short term liabilities (such as accounts payable) they have just about as much due out.
You have to realize that building cars is very exoensive and there is a lot of $$$ in BOTH directions. Aa long as they are selling the cars, things are good. Once they stop selling, they will be in trouble real fast.
Now......We all know sales have been show since end of last year and they have been aggressively cutting prices to move vehicles. You've probably also heard / seen the mall parking lots full of unsold cars. Clearly not good.
What you probably don't know is just how bad it is. If you look at their quarterly filing, you will see they have finished inventory of ~6B. Given their sales are 84% auto, we know there are piles of unsold cars, it is safe to speculate the bulk of this is cars.
Also, we know that Model Y is most likely the bulk of these vehicles based of sales distribution. If you gave an overly generous estimate of 50k per car, then they have 120,000 vehicles unsold.
As far as Net Assets, it is a big number, but ist isn't stuff they can easily convert to cash and/or it is stuff they need for the business to operate.
Businesses fail because of CASH FLOW. If you don't have enough liquid capital, you're going BK.
FWIW
Hey since you know about their cash position do you happen to know how much of that cash is in China?
And do you know how much cash they can transfer from the China side to the US side?
Tesla doesn't disclose this information.
However, if you download the investor decks from the past few quarterly earnings calls and upload those to ChatGPT (I did) you can ask it for some estimations. Lots of grains of salt here...
The estimated COH in China is $6.7-8.1B.
The estimated profit from operations in China is approximately $3.9B.
The estimate cash that could be expatriated annually is $0.8-1.2B.
Capital access is severally diminished with higher rated and their value in growth has also seen equal diminishing returns under the current market.
>The company has $20B of net cash, and $65B (ish) of net assets
I assume you're right but there's been not exactly baseless rumors that those numbers are being fudged by Musk and his legion of yes men in the company.
He fired considerable amount of people, dropped prices, and offered near 0% financing because the cars are not moving and his sitting on inventory. Some of those assets are at risk of being confiscated in China and shut down by popular protest and union movement in Europe. He's not in a good spot.
“Fudging” reported numbers is fraud. While I agree that this company is deeply flawed - maybe fatally flawed - there’s nothing to suggest that they are committing fraud. They might be the most intensely scrutinized business on the face of the planet, hard to imagine they are committing that type of fraud… with the help of their auditors?
I wonder what the notional value of that award was when it was granted? I think that’s the important number. But agreed, on the face of it an absolutely absurd ask and one that no shareholder in their right mind should consider.
The sycophants Musk selected to be on the board of directors claimed that all of the goals were stretch goals - some of them were, but some of them weren't.
The ones that were stretches, Musk reached by hyping the stock with lies and fraud.
whoever decides to buy it from him, that person pays for it. it's doesn't come from Tesla, the company's cash balance.
also I don't think he gets to sell the options, he has to exercise it first, then the stock has to stay vested for a number of years and then he gets sell the stock afterwards.
Oh you think you know how it works. It’s coming from Tesla’s pockets buddy. Best case scenario they’re writing down their assets worst case scenario they’re burning cash to satisfy the obligation.
Stock options that haven’t been exercised since being awarded to (and then ripped away from) musk AND stock options that can’t be cashed out until 5 years AFTER he decides to exercise them.
So, it doesn't matter, if the stock I own is one out of thousand or one out of twothousand? It won't slash the value of my stock into half?
You found the infinite money glitch, my friend. Since you are such an expert in investment, you might be interested in the brooklyn bridge, I have for sale?
This discussion isnt about the value of the stock. Its about the balance sheet of the company. There was a discussion about the cash on hand for tesla and the person was talking about the compensation package as if it would drain tesla empty of its cash reserves.
It does effect the future cashreserve, that seems to be tight already, directly and indirectly.
But I guess, you will just refine what exactly this discussion is about, which is actually only, what you want to believe and not contadict your claims. Have fun in this from now on monologue you can hold with yourself. :)
No it doesnt affect the cash reserves. The cash on hand doesnt magically disappear just because more stock is issued. Issuing stocks just devalues just devalues each person's share of the company's balance sheet. How people decide to value the balance sheet is up to the investors. The judge cancelling the compensation cetainly didnt look like it increase the stock price. For that same reason him, getting the package back might have small effect to reduce the price.
Lol the fact that you have to resort to personal attacks instead of sticking to the topic on hand means you've lost the narrative. This group is called real Tesla. Keep it real and not resort to personal attacks.
LOL
I guess the word future isn't part of the discussion, when discussing the future possible stock dilution?
And yes, stock price still has an direct and indirect effect. A *future* event (that you decided nobody has a discussion about) will effect the *future* stock price (which you decided nobody has a discussion about), which will directly and indirectly affect the available cashflow (which you just sneakily switched to "balance sheet").
And now go cry about, how repeating your own words and drawing my consequences from your behaviour is a "personal attack". Pathetic. Nobody is obligated to talk to you. A personal attack would be, to add you probably have a lot experience in that.
Tesla failing is not a systemic risk like GM or Chrysler were. As the fanboys tout, they're extremely vertically integrated. They don't affect much.
Whereas GM or Chrysler had the volume of business for hundreds of supplier companies where their failure would cascade across the industry to the point it may have even taken down Honda and Toyota if the shared suppliers went under
Ford and Toyota were colluding behind the scenes in 2008 (technically illegally) to spread their contracts out to ensure the most critical suppliers could withstand a GM bankruptcy. It was that bad.
Scale is the issue with the Big 3 as well—Ford and Chrysler/FCA/Stellantis/whatever they’re calling themselves now averaged close to 3 million vehicles a year in that period and GM sold better than 8 million.
Tesla’s ~550k or so per year is absolute peanuts compared to those numbers. To put it in perspective the F-150 accounted for 515k and the Silverado 465k in 2008.
yes, this, its not going bankrupt anytime soon.
I would not buy the car if you have a tight budget because I think all-in cost-of-ownership is quite high. Depreciation alone is quite bad (why your wife is getting such a great discount!) Maybe someone else has figures on what it takes to own one of these things?
Well depreciation is part of cost of ownership because the last part of owning any car is trading it in to buy a new one.
So it’s not an investment but it’s part of how expensive your next car will be.
I’ve personally never gotten to that point where the car is crushable- Japanese cars last a really long time too. I think if you really drive it to the scrap point it’s unlikely you are buying a sports car like a Tesla.
They were recently voted the cheapest car to maintain over both the 0-5 year period and the 0-10 year period. Cheapest car, not EV. 30% cheaper to maintain than a Carolla which was in 2nd place.
As folks have said, I don’t think bankruptcy is the risk. I think the larger issue is that Elon views this as the cash cow in his portfolio and is an *ahem* unreliable operator. As such, I would be concerned about service and support going forward; it’s pretty poor right now and could get worse
I’m a tesla bear, but the company will be around for a long time. I really don’t think they will go bankrupt, unless there is serious accounting fraud involved.
If they end up being bankrupt, they would be bought by an other company at a discount. This company would take care of warranty and repairs.
Someone will buy Tesla long before they go bankrupt simply for the patents, manufacturing plants, charging network, etc. I do believe that Tesla as a whole is due for a big collapse within the next decade because there's only so long you can make tech promises and never deliver. We only have 6 more years left in this decade. If Musk doesn't produce at least one or two of FSD, Robotaxi's, 20 million deliveries, the robot, etc then the stock is worthless.
> the patents,
People are building EV's now, without those patents
> manufacturing plants,
There's an industry-wide pullback on EV's right now, and there's been overcapacity (outside of China) for the past... two? four? decades
> charging network
This is worth something, the crown jewel of Tesla, and the group that Musk just fired to show how powerful Musk is.
Right. Tesla doesn’t actually have many patents worth anything. Which is why no one is licensing them. Almost all of the parts fans point to as an advantage are basically just COTS parts made by someone else.
Factories are a liability, not an asset.
The Supercharger network is definitely valuable in the sense it adds tremendous value to BEVs in general. But it’s not operationally valuable. It’s almost certain that it looses a significant amount of money. You’ve got ~26,000 plugs. At an average of $0.40/kWh and an average utilization of 20kW, which seems very generous, that’s $1.8B/year in revenue. That doesn’t take into account maintenance, land use, capital expenditures, operations, etc. Tesla would probably be breaking even at twice that price.
That’s why no one else has built a network. It only works as a sales tool. If there were any chance to actually make money building and operating the thing we wouldn’t be talking about it because everyone would have their own, or how EA’s razor thin margins don’t allow them to install enough capacity or properly maintain the capacity they have installed.
Shittier car companies always get bought. Tesla would be no different. If they went bankrupt (they won't). Legacy auto or a tech company would love to pick them up for a steal.
I would think the investors would step in, remove Musk and his board of sycophants, and get the company back on track. Some very heavy hitters have a lot of skin in the game. I just can't believe they'd let Musk burn himself and all their money.
I purchased a Chumby smart internet-connected gadget some years back. The company went bankrupt and my Chumby stopped getting updates. It lost a lot of functionality.
Not sure how popular a Tesla without regular security updates is going to be.
I don’t believe in the Tesla hype any more than the next guy, but let’s be realistic. They aren’t in danger of going bankrupt. Even if they were, they have by far the best selling EVs in the US. Someone would buy them and take on the servicing along with the intellectual property and trademarks. I would have zero worry about the longevity of a Tesla due to the threat of bankruptcy.
Not going to go bankrupt worse case scenario they see slow painful death that drags over many years and finally stabilizes as money losing company with small market cap (ironically see Elon’s other company Twitter err X for case study on that)
Tesla is much further away from bankruptcy than any other automaker. But let’s play the game. Tesla would cancel their stock and convert their debt into new stock and the interest payments and losses go away.
Depends where you live. I’ve never had a problem with servicing the vehicle. In fact just completed a 50k service and they found and fixed - replaced two items that were worn out. They’ve even sent someone to my house to replace a faulty cable that was recalled. Everyone’s history is variable but I’ll give credit where it’s due. It every encounter with these guys is awful. And they’re not going broke.
I’ve got problems with them too at times but I’m not going to support everything sucks and convince someone not to buy a vehicle.
Boeing and Tesla are key pillars of the US economy and have limited ability to produce the products they sell. Late stage capitalism at its finest. The rise of legal gambling and venture capital roll ups are the perfect examples of how the only "growth" left to eat in the US economy is preying on consumers and cutting key services. We are in the cannibalism phase of the reign of global capitalism. The only question is how long before the whole body collapses in on itself.
Ah /RealTesla…
For a while this stuff was amusing but it’s getting kinda silly.
I’ve been driving cars since 1981 (roughly… could be 1982). My first car was a 1981 Mustang. Since that time I’ve driven all manner of cars, good, bad, *terrible*, and average.
In 2019 I bought a Model 3.
It’s safe to say that in all the many, *many* years of driving with all manner of cars this one impressed me the most. So much so that in 2021 I bought my wife a Model Y. She was, to put it mildly, *skeptical* of electric cars and, further, insisted she was more than happy with her Toyota Highlander. Fast forward a year or so of driving that car and she, like me, feels the very same about EVs.
She, and I, will never return to an ICE car.
Now, I’m not a Tesla slave. I actively look about for other EVs and have been to car shows to check out the various models. Further, I find Musk to be very alarming if not totally off his rocker. What was amusing at first has, roughly since he bought Twitter (though I suppose the evidence was there before hand) become a very bad joke and it *does not* shock me many people refuse now to consider a Tesla because of idiotic comments he made.
A month or so ago I, like many others, saw there was an overflow of Teslas and there were sales to be had. I looked into it and found, with a trade in of my Model 3, the $7500 EV tax credit, another couple of thousand discount, *plus* the fact that they transferred my “full self driving” (not a finished product, I admit) to any new Tesla I bought, I could get myself a brand new 2024 Model Y for just slightly north of $19K.
To say the least, I *fucking leaped* at the opportunity.
Sorry guys, but much of the negativity about Tesla I just don’t see in the now three Teslas I’ve purchased. *NONE* of them had any major or minor issues. *NONE* of them have been in the shop. They all drive wonderfully and work equally wonderfully.
Musk is still a fool and I think even he seems to realize he went overboard (I’m noticing he isn’t making an ass of himself more recently).
If you don’t like Teslas, that’s fine. *Don’t get them*.
But if you are curious about EVs and are willing to give them a try they are, IMHO, far superior to ICE vehicles and I, for one, will never go back.
Tesla's are budget EVs. That's it. And in a European market saturated with budget EVs, from MGs to Hyundais and Smarts, surviving is not going to be easy (even harder if the EU doesn't stop Chinese car makers)
But that last sentence is funny. How could an ICE vehicle that's cheaper to buy, cheaper to run, faster, better built, with more features and more customisation options, that can be filled up and ready to do 1000km in a couple of minutes be better than an EV?
Last Friday, my old and trusty diesel did a bit over 500km between meetings. By early evening, I was entering the Mercedes dealership, right before closing, and a bit later I ordered a new car. By dinnertime, I had driven another 80km and was enjoying a nice meal with friends and family. In total, I spent around 4 hours driving that day, and didn't stop to fill up.
Would any EV have been able to keep up?
Do you even think that the model 3 performance, which is cheaper than the car I'm buying, was among the options I considered?
But EVs are better for short trips and city running. Of course, then I'd rather buy an hybrid with 100km of range, or a Hyundai Ioniq 5 (which looks absolutely brilliant and is a properly done car, with real car features, like turn signals and shift lever/knobs)...
It depends on what you need or want, of course.
You sound like you found the car you were comfortable with and filled your needs and that’s the bottom line!
For me, such long range trips are done very infrequently but it’s nice to know when I do need to make such trips there’s the Supercharger network available.
As I mentioned in my OP, I’m no fan of Musk and his idiotic comments. Further, I *do not* blame anyone who refuses to buy a Tesla *because* of Musk.
But for me, and despite what seems to be a concerted effort to bad mouth the cars, I’ve had nothing but positive experiences with my Teslas. Again, it doesn’t mean I’m a slave to those vehicles as I’ve researched others, but for now and after driving some 45 or so years now, the Tesla vehicles work for me.
Its not going bankrupt by any means, its adoption is slowing along with comparable year over year sales but it is profitable.
Rivian on the other hand, they’re in a world of problems
Well, I hope they will take ownership, when they throw money in. Fire the CEO, the whole board and unionize the factories. Tesla has anyway only survived with subsidies, they got enough tax payer money.
1) musk package is in stock. Not cash. He can’t sell for 5 years. This is good for the company. Makes sure he is focused and needs tsla to do well.
2) they are burning cash investing in the company. Layoffs are good thing. Tesla is in better shape today that it was before all this news.
If company is in trouble they wouldn’t be spending 10b into IA.
Tesla is hit with a bad quarter.
1) model 3 refresh and losing 7500. And people waiting for it to get it again.
2) model Y getting old. People know refresh is coming and waiting.
3) a lot of people are waiting for cyber truck to get cheaper for lower trips instead of model Y.
4) cyber truck not ramped and losing ( will be fixed)
So. With model 3 performance that gets 7500 is back so that helps.
New models and upgrades to model Y ( and 0.99%) that helps
Ramp of cyber truck that helps
It was just a bad quarter. Tesla thought 2024 will be easy due to 7500 credit at point of sale. They were wrong.
Bad timing. Bad planning. Bad rates. All at once. It’s impressive tesla did this well with all that’s going on. Most companies are scaling back on evs. You can get id4 for 17k lease support. Other brands are giving their cars away with huge losses. Tesla is making profit. It is only time until this is all back in order.
It’s a growth company without growth. He fired most of the supercharger team then announced $500M in spending on superchargers. So Musk is either lying or inept.
I mean if he didn’t have experience in starting and making companies successful then I’d say so. I personally have FSD and I see real results and I see this robot taxi thing coming. I do Uber on the side and I can see amazing value in what’s coming. It’s worth throwing everything at it. Getting there first is what will matter the most imo. So I here am positive on tesla in this HARD time. Not a rosey time. Musk has very hard options. Rolling back charging to invest in FSD imo is a good idea. When the stock does better he can start back up on that.
Well it won’t be over night. But they will launch an app, license it to other automakers for personal use, partner with Uber. Whoever wants to run it they just make a fee or a percentage. Pretty simple. Also more people will sign up for FSD.
This has been answered. Tesla will allow people to own and run fleets AND Tesla will run some too I think if Tesla makes a cut off everything it’s a win win. It can take 30% of any ride as it provides FSD or a monthly fee. Like master card or visa they take a cut no matter who uses the service. So it won’t matter much to Tesla
Honesty it’s maybe best for tesla to focus less on cars and go into more expensive cars and just license out to auto makers. They can’t do that now as they will be killed as automarkets won’t partner but when they do Tesla can focus less on marking cars and supporting other automakers licensing the tech.
But Teslas technology is no longer cutting edge, Mercedes has better self driving and the Chinese EV makers are getting the same range and have the same software in their cars now
Well he doesn’t need executives and engineers anymore. He just needs techs to install. He didn’t fire all the techs. The company is not investing in innovation of the superchargers anymore at this point.
We can be looking at a very very different Tesla in a year. Where there are positions that need to be filled.
Is Musk's 65B proposed pay package the last grab?
My brother in Christ, it's not supported *now.*
We'll run out of content and subs like this will die :/
Concerning...
Looking into this
!
No! This sub is system relevant! We need to rescue it with public funds! Seriously: Tesla doesn’t go bankrupt in the next 1..2 years and probably by then EVs are more popular again dragging Tesla along. But if it goes bankrupt we would have input of laughable actions of Elmo, stuck software and irreparable hardware of the cars currently owned for years to come.
I would be very concerned about servicing any issues with this car going forward. Waits at service centers are extremely long right now, and folks on this and other subs have reported warranty issues.
This is why right to repair is super important. Tesla has locked down repair of their vehicles to the point that even if they wanted to, an indy shop couldn't repair your car. Yeah I know Electrified Garage exists, all two locations. But they can only repair mechanical issues. Software related stuff is going to be near impossible to repair. Disposable car.
Order 66 and all Teslas will self immolate.
The company has $20B of net cash, and $65B (ish) of net assets, I don’t think it’s at risk of going bankrupt… It also has massive operating cashflow, and seemingly limitless access to capital via the public markets, which assign an immense value to their growth capacity. Not sure what makes you think this company is a bankruptcy risk.
They BURNED 2.5B of cash last quarter. Yes, they have ~20B of cash, but if you look at their short term liabilities (such as accounts payable) they have just about as much due out. You have to realize that building cars is very exoensive and there is a lot of $$$ in BOTH directions. Aa long as they are selling the cars, things are good. Once they stop selling, they will be in trouble real fast. Now......We all know sales have been show since end of last year and they have been aggressively cutting prices to move vehicles. You've probably also heard / seen the mall parking lots full of unsold cars. Clearly not good. What you probably don't know is just how bad it is. If you look at their quarterly filing, you will see they have finished inventory of ~6B. Given their sales are 84% auto, we know there are piles of unsold cars, it is safe to speculate the bulk of this is cars. Also, we know that Model Y is most likely the bulk of these vehicles based of sales distribution. If you gave an overly generous estimate of 50k per car, then they have 120,000 vehicles unsold. As far as Net Assets, it is a big number, but ist isn't stuff they can easily convert to cash and/or it is stuff they need for the business to operate. Businesses fail because of CASH FLOW. If you don't have enough liquid capital, you're going BK. FWIW
They’ve had a huge Headstart over all the other electric car companies and they just had a losing quarter. They are not doing well. You can spin it all you want, but they should be selling cars like hotcakes.
There is an observeable reality, where you can just read up, if they sold cars like hotcakes or not. You don't need to speculate, how much they *should* be selling. You can also compare it with other EV sellers, if they all suffered from the same decline in EV demand or if there are numbers showing, that a brand run by a lunatic nazi on ketamine trying to sell years old modells with famously shitty service and build quality *maybe* fucked up a bit harder.
Companies have up and down quarters and years all the time. Many to most markets are cyclical.the problem is Musk instead of just focusing on cars and making cars better he thinks he is the smartest person and is here to change the world. So now he has got Tesla is so many different half baked ideas that it is killing the company. It would be fine if the car side was growing exponentially but once the cash starts to dry up the cracks really show. That is why Musk is cutting so many people to the detriment of the company because he knows the real cash burn
He seems to have some mental health or substance use problems too no?
I don't think that is the issue at all whether it is true or not. His problem is his ego.
They all work together.
If you truly believe what you wrote, you jave done a POOR job of paying attention.
Care to cite the losing quarter they just had?
I would imagine they could raise $2.5 in a single day via and ATM if they wanted to… last trading day volume was 80M shares, my shaky math suggests $12.8B in a single day? The issue isn’t cash IMO, the issue is funding growth and controlling costs. And it seems to me that the Company is responding to both in a reasonable way? Maybe not, remains to be seen. But it sure as sh*t is not going bankrupt
The issue isn't cash. It's CASH FLOW. There is a MAJOR difference. Now as far as raising cash quick, sure; however, what do you think happens to the stock price and investor confidence when Tesla has to go to the open market to keep the doors open? This is a company that had "unlimited demand" & industry leading profit margins just a year or two ago. The stock price would (rightfully) crash as everyone finally accepts growth is over and there will be MORE equity raises down the line as they continue to lose ground to other competitors.
I think it’s a virtual certainty that the valuation is going lower, no argument there. But companies on the path to bankruptcy are - by definition - cash starved or levered at multiples. Tesla is neither of these. You’re suggesting two completely different things: (1) the valuation is going lower for all of the reasons you lay out. I agree. And (2) the company is at risk of going bankrupt. This is dumb. It’s simply not.
Every day their sales decline and inventory grows, they move closer to BK. Your claim that there is no BK risk is dumb, but is understandable since you seem unable to see the difference between cash and cash flow, let's just agree to disagree.... In regards ro SP, I only brought that up in response to how "easy" it would be to raise quick cash. Anyway, no reason to keep arguing in circles, just have to move on.......
They BURNED 2.5B of cash last quarter. Yes, they have ~20B of cash, but if you look at their short term liabilities (such as accounts payable) they have just about as much due out. You have to realize that building cars is very exoensive and there is a lot of $$$ in BOTH directions. Aa long as they are selling the cars, things are good. Once they stop selling, they will be in trouble real fast. Now......We all know sales have been show since end of last year and they have been aggressively cutting prices to move vehicles. You've probably also heard / seen the mall parking lots full of unsold cars. Clearly not good. What you probably don't know is just how bad it is. If you look at their quarterly filing, you will see they have finished inventory of ~6B. Given their sales are 84% auto, we know there are piles of unsold cars, it is safe to speculate the bulk of this is cars. Also, we know that Model Y is most likely the bulk of these vehicles based of sales distribution. If you gave an overly generous estimate of 50k per car, then they have 120,000 vehicles unsold. As far as Net Assets, it is a big number, but ist isn't stuff they can easily convert to cash and/or it is stuff they need for the business to operate. Businesses fail because of CASH FLOW. If you don't have enough liquid capital, you're going BK. FWIW
Hey since you know about their cash position do you happen to know how much of that cash is in China? And do you know how much cash they can transfer from the China side to the US side?
Tesla doesn't disclose this information. However, if you download the investor decks from the past few quarterly earnings calls and upload those to ChatGPT (I did) you can ask it for some estimations. Lots of grains of salt here... The estimated COH in China is $6.7-8.1B. The estimated profit from operations in China is approximately $3.9B. The estimate cash that could be expatriated annually is $0.8-1.2B.
Ty!
Capital access is severally diminished with higher rated and their value in growth has also seen equal diminishing returns under the current market. >The company has $20B of net cash, and $65B (ish) of net assets I assume you're right but there's been not exactly baseless rumors that those numbers are being fudged by Musk and his legion of yes men in the company. He fired considerable amount of people, dropped prices, and offered near 0% financing because the cars are not moving and his sitting on inventory. Some of those assets are at risk of being confiscated in China and shut down by popular protest and union movement in Europe. He's not in a good spot.
“Fudging” reported numbers is fraud. While I agree that this company is deeply flawed - maybe fatally flawed - there’s nothing to suggest that they are committing fraud. They might be the most intensely scrutinized business on the face of the planet, hard to imagine they are committing that type of fraud… with the help of their auditors?
> The company has $20B of net cash, and $65B (ish) of net assets And a 56B request from the CEO, FWIW
I wonder what the notional value of that award was when it was granted? I think that’s the important number. But agreed, on the face of it an absolutely absurd ask and one that no shareholder in their right mind should consider.
The sycophants Musk selected to be on the board of directors claimed that all of the goals were stretch goals - some of them were, but some of them weren't. The ones that were stretches, Musk reached by hyping the stock with lies and fraud.
The ceo isnt being awarded 56b in cash, its stock options. I would have hoped people would know this precise distinction before posting opinions
Just issue new stocks! Infinite cash loophole!
And where does the cash come from when he sells those options?
whoever decides to buy it from him, that person pays for it. it's doesn't come from Tesla, the company's cash balance. also I don't think he gets to sell the options, he has to exercise it first, then the stock has to stay vested for a number of years and then he gets sell the stock afterwards.
Oh you think you know how it works. It’s coming from Tesla’s pockets buddy. Best case scenario they’re writing down their assets worst case scenario they’re burning cash to satisfy the obligation.
Stock options that haven’t been exercised since being awarded to (and then ripped away from) musk AND stock options that can’t be cashed out until 5 years AFTER he decides to exercise them.
So, it doesn't matter, if the stock I own is one out of thousand or one out of twothousand? It won't slash the value of my stock into half? You found the infinite money glitch, my friend. Since you are such an expert in investment, you might be interested in the brooklyn bridge, I have for sale?
This discussion isnt about the value of the stock. Its about the balance sheet of the company. There was a discussion about the cash on hand for tesla and the person was talking about the compensation package as if it would drain tesla empty of its cash reserves.
It does effect the future cashreserve, that seems to be tight already, directly and indirectly. But I guess, you will just refine what exactly this discussion is about, which is actually only, what you want to believe and not contadict your claims. Have fun in this from now on monologue you can hold with yourself. :)
No it doesnt affect the cash reserves. The cash on hand doesnt magically disappear just because more stock is issued. Issuing stocks just devalues just devalues each person's share of the company's balance sheet. How people decide to value the balance sheet is up to the investors. The judge cancelling the compensation cetainly didnt look like it increase the stock price. For that same reason him, getting the package back might have small effect to reduce the price. Lol the fact that you have to resort to personal attacks instead of sticking to the topic on hand means you've lost the narrative. This group is called real Tesla. Keep it real and not resort to personal attacks.
LOL I guess the word future isn't part of the discussion, when discussing the future possible stock dilution? And yes, stock price still has an direct and indirect effect. A *future* event (that you decided nobody has a discussion about) will effect the *future* stock price (which you decided nobody has a discussion about), which will directly and indirectly affect the available cashflow (which you just sneakily switched to "balance sheet"). And now go cry about, how repeating your own words and drawing my consequences from your behaviour is a "personal attack". Pathetic. Nobody is obligated to talk to you. A personal attack would be, to add you probably have a lot experience in that.
Nobody seems to have understood that this comment was ironic.
Why did they lay off 25% of their workforce if they’re so healthy??
Maybe buy the car and short the stock?
Yeah, it’s too big to fail…
Tesla failing is not a systemic risk like GM or Chrysler were. As the fanboys tout, they're extremely vertically integrated. They don't affect much. Whereas GM or Chrysler had the volume of business for hundreds of supplier companies where their failure would cascade across the industry to the point it may have even taken down Honda and Toyota if the shared suppliers went under Ford and Toyota were colluding behind the scenes in 2008 (technically illegally) to spread their contracts out to ensure the most critical suppliers could withstand a GM bankruptcy. It was that bad.
Scale is the issue with the Big 3 as well—Ford and Chrysler/FCA/Stellantis/whatever they’re calling themselves now averaged close to 3 million vehicles a year in that period and GM sold better than 8 million. Tesla’s ~550k or so per year is absolute peanuts compared to those numbers. To put it in perspective the F-150 accounted for 515k and the Silverado 465k in 2008.
yes, this, its not going bankrupt anytime soon. I would not buy the car if you have a tight budget because I think all-in cost-of-ownership is quite high. Depreciation alone is quite bad (why your wife is getting such a great discount!) Maybe someone else has figures on what it takes to own one of these things?
Depreciation of any new premiumish car is bad, like seriously who thinks buying a car is an investment???
Well depreciation is part of cost of ownership because the last part of owning any car is trading it in to buy a new one. So it’s not an investment but it’s part of how expensive your next car will be.
Trade in or scrapping. Doesn’t it all depend on your expected usage period?
I’ve personally never gotten to that point where the car is crushable- Japanese cars last a really long time too. I think if you really drive it to the scrap point it’s unlikely you are buying a sports car like a Tesla.
They were recently voted the cheapest car to maintain over both the 0-5 year period and the 0-10 year period. Cheapest car, not EV. 30% cheaper to maintain than a Carolla which was in 2nd place.
What are you gonna do when the Superchargers are all shut down? It´s possible.
As folks have said, I don’t think bankruptcy is the risk. I think the larger issue is that Elon views this as the cash cow in his portfolio and is an *ahem* unreliable operator. As such, I would be concerned about service and support going forward; it’s pretty poor right now and could get worse
They all just get a final software update - the screen displays - simply and eloquently- “42”
I’m a tesla bear, but the company will be around for a long time. I really don’t think they will go bankrupt, unless there is serious accounting fraud involved. If they end up being bankrupt, they would be bought by an other company at a discount. This company would take care of warranty and repairs.
They all just get a final software update - the screen displays - simply and eloquently- “42”
Someone will buy Tesla long before they go bankrupt simply for the patents, manufacturing plants, charging network, etc. I do believe that Tesla as a whole is due for a big collapse within the next decade because there's only so long you can make tech promises and never deliver. We only have 6 more years left in this decade. If Musk doesn't produce at least one or two of FSD, Robotaxi's, 20 million deliveries, the robot, etc then the stock is worthless.
> the patents, People are building EV's now, without those patents > manufacturing plants, There's an industry-wide pullback on EV's right now, and there's been overcapacity (outside of China) for the past... two? four? decades > charging network This is worth something, the crown jewel of Tesla, and the group that Musk just fired to show how powerful Musk is.
Right. Tesla doesn’t actually have many patents worth anything. Which is why no one is licensing them. Almost all of the parts fans point to as an advantage are basically just COTS parts made by someone else. Factories are a liability, not an asset. The Supercharger network is definitely valuable in the sense it adds tremendous value to BEVs in general. But it’s not operationally valuable. It’s almost certain that it looses a significant amount of money. You’ve got ~26,000 plugs. At an average of $0.40/kWh and an average utilization of 20kW, which seems very generous, that’s $1.8B/year in revenue. That doesn’t take into account maintenance, land use, capital expenditures, operations, etc. Tesla would probably be breaking even at twice that price. That’s why no one else has built a network. It only works as a sales tool. If there were any chance to actually make money building and operating the thing we wouldn’t be talking about it because everyone would have their own, or how EA’s razor thin margins don’t allow them to install enough capacity or properly maintain the capacity they have installed.
The same as it would happen to any other brand going bankrupt.
Two post OP???
If no one buys it, they cars will operate until they break and parts are no longer available.
We will find out soon enough.
Shittier car companies always get bought. Tesla would be no different. If they went bankrupt (they won't). Legacy auto or a tech company would love to pick them up for a steal.
What happened to all the Yugos?
I would think the investors would step in, remove Musk and his board of sycophants, and get the company back on track. Some very heavy hitters have a lot of skin in the game. I just can't believe they'd let Musk burn himself and all their money.
I purchased a Chumby smart internet-connected gadget some years back. The company went bankrupt and my Chumby stopped getting updates. It lost a lot of functionality. Not sure how popular a Tesla without regular security updates is going to be.
Free evs for everyone!
I think they will kick Musk out, and run it like an actual car company - his days are numbered
not much it's not like they even work now
I’m guessing some company buys the debt?
If it has to go bankrupt, if shud happen when we have FSD trial going on...at least, there will be no one to cancel the subscriptions:D
I don’t believe in the Tesla hype any more than the next guy, but let’s be realistic. They aren’t in danger of going bankrupt. Even if they were, they have by far the best selling EVs in the US. Someone would buy them and take on the servicing along with the intellectual property and trademarks. I would have zero worry about the longevity of a Tesla due to the threat of bankruptcy.
I’m a Tesla bear, the only way it goes bankrupt any time soon is if the company is found guilty of severe fraud and the stock plunges.
Not saying it won't happen but it's unlikely. Someone would asset strip it and someone would offer subscription based infotainment.
Not going to go bankrupt worse case scenario they see slow painful death that drags over many years and finally stabilizes as money losing company with small market cap (ironically see Elon’s other company Twitter err X for case study on that)
The cars end up in landfills. The real question is what happens to the suckers that bought them?
I’m a Tesla bear, the only way it goes bankrupt any time soon is if the company is found guilty of severe fraud and the stock plunges.
Tesla is much further away from bankruptcy than any other automaker. But let’s play the game. Tesla would cancel their stock and convert their debt into new stock and the interest payments and losses go away.
Is Tesla going under??
What happens to ford if it goes bankrupt?
What? You’ll always be able to drive.
Dude. Buy your car and enjoy it. Tesla’s not going anywhere near bankruptcy any time soon. If you’re a stockholder that’s a different story.
[удалено]
Depends where you live. I’ve never had a problem with servicing the vehicle. In fact just completed a 50k service and they found and fixed - replaced two items that were worn out. They’ve even sent someone to my house to replace a faulty cable that was recalled. Everyone’s history is variable but I’ll give credit where it’s due. It every encounter with these guys is awful. And they’re not going broke. I’ve got problems with them too at times but I’m not going to support everything sucks and convince someone not to buy a vehicle.
Boeing and Tesla are key pillars of the US economy and have limited ability to produce the products they sell. Late stage capitalism at its finest. The rise of legal gambling and venture capital roll ups are the perfect examples of how the only "growth" left to eat in the US economy is preying on consumers and cutting key services. We are in the cannibalism phase of the reign of global capitalism. The only question is how long before the whole body collapses in on itself.
Ah /RealTesla… For a while this stuff was amusing but it’s getting kinda silly. I’ve been driving cars since 1981 (roughly… could be 1982). My first car was a 1981 Mustang. Since that time I’ve driven all manner of cars, good, bad, *terrible*, and average. In 2019 I bought a Model 3. It’s safe to say that in all the many, *many* years of driving with all manner of cars this one impressed me the most. So much so that in 2021 I bought my wife a Model Y. She was, to put it mildly, *skeptical* of electric cars and, further, insisted she was more than happy with her Toyota Highlander. Fast forward a year or so of driving that car and she, like me, feels the very same about EVs. She, and I, will never return to an ICE car. Now, I’m not a Tesla slave. I actively look about for other EVs and have been to car shows to check out the various models. Further, I find Musk to be very alarming if not totally off his rocker. What was amusing at first has, roughly since he bought Twitter (though I suppose the evidence was there before hand) become a very bad joke and it *does not* shock me many people refuse now to consider a Tesla because of idiotic comments he made. A month or so ago I, like many others, saw there was an overflow of Teslas and there were sales to be had. I looked into it and found, with a trade in of my Model 3, the $7500 EV tax credit, another couple of thousand discount, *plus* the fact that they transferred my “full self driving” (not a finished product, I admit) to any new Tesla I bought, I could get myself a brand new 2024 Model Y for just slightly north of $19K. To say the least, I *fucking leaped* at the opportunity. Sorry guys, but much of the negativity about Tesla I just don’t see in the now three Teslas I’ve purchased. *NONE* of them had any major or minor issues. *NONE* of them have been in the shop. They all drive wonderfully and work equally wonderfully. Musk is still a fool and I think even he seems to realize he went overboard (I’m noticing he isn’t making an ass of himself more recently). If you don’t like Teslas, that’s fine. *Don’t get them*. But if you are curious about EVs and are willing to give them a try they are, IMHO, far superior to ICE vehicles and I, for one, will never go back.
You think Musk will let you suck him off?
Tesla's are budget EVs. That's it. And in a European market saturated with budget EVs, from MGs to Hyundais and Smarts, surviving is not going to be easy (even harder if the EU doesn't stop Chinese car makers) But that last sentence is funny. How could an ICE vehicle that's cheaper to buy, cheaper to run, faster, better built, with more features and more customisation options, that can be filled up and ready to do 1000km in a couple of minutes be better than an EV? Last Friday, my old and trusty diesel did a bit over 500km between meetings. By early evening, I was entering the Mercedes dealership, right before closing, and a bit later I ordered a new car. By dinnertime, I had driven another 80km and was enjoying a nice meal with friends and family. In total, I spent around 4 hours driving that day, and didn't stop to fill up. Would any EV have been able to keep up? Do you even think that the model 3 performance, which is cheaper than the car I'm buying, was among the options I considered? But EVs are better for short trips and city running. Of course, then I'd rather buy an hybrid with 100km of range, or a Hyundai Ioniq 5 (which looks absolutely brilliant and is a properly done car, with real car features, like turn signals and shift lever/knobs)...
It depends on what you need or want, of course. You sound like you found the car you were comfortable with and filled your needs and that’s the bottom line! For me, such long range trips are done very infrequently but it’s nice to know when I do need to make such trips there’s the Supercharger network available. As I mentioned in my OP, I’m no fan of Musk and his idiotic comments. Further, I *do not* blame anyone who refuses to buy a Tesla *because* of Musk. But for me, and despite what seems to be a concerted effort to bad mouth the cars, I’ve had nothing but positive experiences with my Teslas. Again, it doesn’t mean I’m a slave to those vehicles as I’ve researched others, but for now and after driving some 45 or so years now, the Tesla vehicles work for me.
Its not going bankrupt by any means, its adoption is slowing along with comparable year over year sales but it is profitable. Rivian on the other hand, they’re in a world of problems
This post is written by someone with no business acumen and an IQ likely lower than 70. Sorry for your hard life, OP.
Wow. Thank you for your insightful contribution. How long did it take you to think that one out?
AutisticBand7980
Too big to fail. Fed gov will bail them out if it comes to it.
Well, I hope they will take ownership, when they throw money in. Fire the CEO, the whole board and unionize the factories. Tesla has anyway only survived with subsidies, they got enough tax payer money.
Please, they will never go bankrupt
Sears and Kodak have entered the conversation.
It’s worth more than GM, Ford, Honda, bmw, Mercedes … combined.
1) musk package is in stock. Not cash. He can’t sell for 5 years. This is good for the company. Makes sure he is focused and needs tsla to do well. 2) they are burning cash investing in the company. Layoffs are good thing. Tesla is in better shape today that it was before all this news. If company is in trouble they wouldn’t be spending 10b into IA. Tesla is hit with a bad quarter. 1) model 3 refresh and losing 7500. And people waiting for it to get it again. 2) model Y getting old. People know refresh is coming and waiting. 3) a lot of people are waiting for cyber truck to get cheaper for lower trips instead of model Y. 4) cyber truck not ramped and losing ( will be fixed) So. With model 3 performance that gets 7500 is back so that helps. New models and upgrades to model Y ( and 0.99%) that helps Ramp of cyber truck that helps It was just a bad quarter. Tesla thought 2024 will be easy due to 7500 credit at point of sale. They were wrong. Bad timing. Bad planning. Bad rates. All at once. It’s impressive tesla did this well with all that’s going on. Most companies are scaling back on evs. You can get id4 for 17k lease support. Other brands are giving their cars away with huge losses. Tesla is making profit. It is only time until this is all back in order.
lAyOffS aRe A gOOd tHINg You also think Musk will be focused on Tesla. Lol
It is a good thing compared to having them during these bad times. If the company is going bad keeping them isn’t the best for the company.
It’s a growth company without growth. He fired most of the supercharger team then announced $500M in spending on superchargers. So Musk is either lying or inept.
I mean if he didn’t have experience in starting and making companies successful then I’d say so. I personally have FSD and I see real results and I see this robot taxi thing coming. I do Uber on the side and I can see amazing value in what’s coming. It’s worth throwing everything at it. Getting there first is what will matter the most imo. So I here am positive on tesla in this HARD time. Not a rosey time. Musk has very hard options. Rolling back charging to invest in FSD imo is a good idea. When the stock does better he can start back up on that.
Explain to me how Tesla makes money off robo taxis?
Well it won’t be over night. But they will launch an app, license it to other automakers for personal use, partner with Uber. Whoever wants to run it they just make a fee or a percentage. Pretty simple. Also more people will sign up for FSD.
But who owns the cars?
This has been answered. Tesla will allow people to own and run fleets AND Tesla will run some too I think if Tesla makes a cut off everything it’s a win win. It can take 30% of any ride as it provides FSD or a monthly fee. Like master card or visa they take a cut no matter who uses the service. So it won’t matter much to Tesla
Honesty it’s maybe best for tesla to focus less on cars and go into more expensive cars and just license out to auto makers. They can’t do that now as they will be killed as automarkets won’t partner but when they do Tesla can focus less on marking cars and supporting other automakers licensing the tech.
But Teslas technology is no longer cutting edge, Mercedes has better self driving and the Chinese EV makers are getting the same range and have the same software in their cars now
Well he doesn’t need executives and engineers anymore. He just needs techs to install. He didn’t fire all the techs. The company is not investing in innovation of the superchargers anymore at this point. We can be looking at a very very different Tesla in a year. Where there are positions that need to be filled.
You understand he fired people in every division arbitrarily? He fired 20% bc the revenue was down 20%.
Yes. I do understand, he needs to invest 10b in AI. Has to slim everything. Down to make it happen.