6 ms·

There's a lot to unpack here: * With the reservation numbers, sure, there are a large number of people who put down a refundable $1,000 for a $35K car with a $

by xkjkls 8y ago

There's a lot to unpack here: * With the reservation numbers, sure, there are a large number of people who put down a refundable $1,000 for a $35K car with a $7,500 tax credit, but what is currently available is a $50K car with a rapidly expiring tax credit. I wouldn't call that proof of demand of the current product. * Can they raise money? If they can, why haven't they? There's no MBA1 who would ever recommend leaving a company in the cash position they currently are in. Also, you seem to be under the assumption that billions of dollars exist that can just immediately appear. That's not how the capital markets work. Money raises take many months of effort to materialize. * Also, as this article states the 8,000 cars a week metric might not be the best to focus on. Especially as a company that personally owns all the warranty liability for their cars, if 8,000 cars are being produced by cutting corners, that's not really the positive sign you would expect.

nickik 8y ago
* Tesla sells well in places without a tax credit. * There is no reason to think that Tesla want be selling a 35k car * If 400000 preorders and the most talked about car in human history is not enough for you to prove that there is 'demand', I don't know how t oargue agianst that. * Of course they can raise money, and I think even most bears would agree that this is the case. They have not raised more money because they currently don't need to raise more money, if that changes, they can do so. Honest, people have been making doom and gloom prediction about Tesla 'cash position' for about 10 years and by now their actual cash inflow is growing massively. * If you had actual prove that those 8000 are all broken and a warranty liability then you might have point but up to now very little of these problems have materialized and the quality has gotten better over time
- xkjkls 8y ago
  > Tesla sells well in places without a tax credit. Where? The biggest market is the US by far, and many other locations, like Canada, demand has dissolved without the tax credit. > There is no reason to think that Tesla want be selling a 35k car Other than the CEO once gave a large presentation two years ago selling it as a $35,000 car? And they raised capital multiple times under that premise? That seems pretty significant. > Of course they can raise money, and I think even most bears would agree that this is the case. They have not raised more money because they currently don't need to raise more money, if that changes, they can do so. Well, depends on what "raise money" means? Who is providing this capital and at what terms? Do I think Tesla could raise more debt at the 7-8% that it's debt is currently trading at? Sure, but that has a significant number of long term consequences raising debt at Michael Milken rates. > Honest, people have been making doom and gloom prediction about Tesla 'cash position' for about 10 years and by now their actual cash inflow is growing massively. I don't understand this at all. The company has never once been cash flow positive. What exactly do you mean by cash inflow and "cash position"? Also, Tesla was barely talked about until 5 years ago. Who are these people who are talking doom and gloom before the company went public in 2010? > If you had actual prove that those 8000 are all broken and a warranty liability then you might have point but up to now very little of these problems have materialized and the quality has gotten better over time The major problem here is that the company has had a number of instances being incompletely forthright with its metrics. That creates a pattern of distrust with how exactly to value the company. Any sort of financial projection of Tesla hinges completely on Model 3 margins. There's a growing concern of whether the company's quoted margins are accurate.
  - nickik 8y ago
    > Other than the CEO once gave a large presentation two years ago selling it as a $35,000 car? And they raised capital multiple times under that premise? That seems pretty significant. Independent analysis did agree that there is no technical reason they can not build it. Building the more expensive variant while they get the marginal cost down is just smart business. > Well, depends on what "raise money" means? They have wide range of options, including issuing further stocks. The Saudis for example multiple times asked if they would issue more stocks exclusively. I have heard analysis from multiple different people and pretty much all agree that Tesla is in a good position to raise money. > I don't understand this at all. The company has never once been cash flow positive. What exactly do you mean by cash inflow and "cash position"? Also, Tesla was barely talked about until 5 years ago. Who are these people who are talking doom and gloom before the company went public in 2010? > What exactly do you mean by cash inflow and "cash position"? When you are selling 8000 cars a week you get a lot of cash inflow. Because the production line is up and running the capex is going down at the same time. That makes their current position regarding to cash not very problematic. > Also, Tesla was barely talked about until 5 years ago. Yeah I don't know who you talk to but Tesla was talked about a lot 5 years ago, and even more so in 2008. > Who are these people who are talking doom and gloom before the company went public in 2010? Well they actually did almost go down in 2008 but there were always people, with the S and the X and the Model 3 who claimed (a) Tesla is spending to much (b) Tesla can't deliver on time and so on. You can find articles to that extend all the way back to 2010. > The major problem here is that the company has had a number of instances being incompletely forthright with its metrics. That creates a pattern of distrust with how exactly to value the company. Any sort of financial projection of Tesla hinges completely on Model 3 margins. There's a growing concern of whether the company's quoted margins are accurate. Where is this 'growing concern'. Independent analysis agree that the Model 3 could be produced at good margins. Maybe not as high as Elon hopes, but a huge amount better then any other company can do with electric cars. It seems this huge 'OMG they are using humans' has people now speculating that humans are way to expensive and are gone ruin their margins, but their car lines are pretty efficient and they are not using excessive amounts of labor. Overall their plant is still pretty heavily automated.
  - greglindahl 8y ago

by xkjkls 8y ago

nickik 8y ago

* Tesla sells well in places without a tax credit. * There is no reason to think that Tesla want be selling a 35k car * If 400000 preorders and the most talked about car in human history is not enough for you to prove that there is 'demand', I don't know how t oargue agianst that. * Of course they can raise money, and I think even most bears would agree that this is the case. They have not raised more money because they currently don't need to raise more money, if that changes, they can do so. Honest, people have been making doom and gloom prediction about Tesla 'cash position' for about 10 years and by now their actual cash inflow is growing massively. * If you had actual prove that those 8000 are all broken and a warranty liability then you might have point but up to now very little of these problems have materialized and the quality has gotten better over time

xkjkls 8y ago
> Tesla sells well in places without a tax credit. Where? The biggest market is the US by far, and many other locations, like Canada, demand has dissolved without the tax credit. > There is no reason to think that Tesla want be selling a 35k car Other than the CEO once gave a large presentation two years ago selling it as a $35,000 car? And they raised capital multiple times under that premise? That seems pretty significant. > Of course they can raise money, and I think even most bears would agree that this is the case. They have not raised more money because they currently don't need to raise more money, if that changes, they can do so. Well, depends on what "raise money" means? Who is providing this capital and at what terms? Do I think Tesla could raise more debt at the 7-8% that it's debt is currently trading at? Sure, but that has a significant number of long term consequences raising debt at Michael Milken rates. > Honest, people have been making doom and gloom prediction about Tesla 'cash position' for about 10 years and by now their actual cash inflow is growing massively. I don't understand this at all. The company has never once been cash flow positive. What exactly do you mean by cash inflow and "cash position"? Also, Tesla was barely talked about until 5 years ago. Who are these people who are talking doom and gloom before the company went public in 2010? > If you had actual prove that those 8000 are all broken and a warranty liability then you might have point but up to now very little of these problems have materialized and the quality has gotten better over time The major problem here is that the company has had a number of instances being incompletely forthright with its metrics. That creates a pattern of distrust with how exactly to value the company. Any sort of financial projection of Tesla hinges completely on Model 3 margins. There's a growing concern of whether the company's quoted margins are accurate.
- nickik 8y ago
  > Other than the CEO once gave a large presentation two years ago selling it as a $35,000 car? And they raised capital multiple times under that premise? That seems pretty significant. Independent analysis did agree that there is no technical reason they can not build it. Building the more expensive variant while they get the marginal cost down is just smart business. > Well, depends on what "raise money" means? They have wide range of options, including issuing further stocks. The Saudis for example multiple times asked if they would issue more stocks exclusively. I have heard analysis from multiple different people and pretty much all agree that Tesla is in a good position to raise money. > I don't understand this at all. The company has never once been cash flow positive. What exactly do you mean by cash inflow and "cash position"? Also, Tesla was barely talked about until 5 years ago. Who are these people who are talking doom and gloom before the company went public in 2010? > What exactly do you mean by cash inflow and "cash position"? When you are selling 8000 cars a week you get a lot of cash inflow. Because the production line is up and running the capex is going down at the same time. That makes their current position regarding to cash not very problematic. > Also, Tesla was barely talked about until 5 years ago. Yeah I don't know who you talk to but Tesla was talked about a lot 5 years ago, and even more so in 2008. > Who are these people who are talking doom and gloom before the company went public in 2010? Well they actually did almost go down in 2008 but there were always people, with the S and the X and the Model 3 who claimed (a) Tesla is spending to much (b) Tesla can't deliver on time and so on. You can find articles to that extend all the way back to 2010. > The major problem here is that the company has had a number of instances being incompletely forthright with its metrics. That creates a pattern of distrust with how exactly to value the company. Any sort of financial projection of Tesla hinges completely on Model 3 margins. There's a growing concern of whether the company's quoted margins are accurate. Where is this 'growing concern'. Independent analysis agree that the Model 3 could be produced at good margins. Maybe not as high as Elon hopes, but a huge amount better then any other company can do with electric cars. It seems this huge 'OMG they are using humans' has people now speculating that humans are way to expensive and are gone ruin their margins, but their car lines are pretty efficient and they are not using excessive amounts of labor. Overall their plant is still pretty heavily automated.
- greglindahl 8y ago