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Staying Public
- minimaxir 8y agoThe SEC will definitely not be amused.
- karpodiem 8y ago$TSLAQ it is. https://news.ycombinator.com/item?id=17836641 https://news.ycombinator.com/item?id=17836641
- TaylorAlexander 8y agoI saw that comment before, and I disagree with it. I don’t care what some sample of their first pass yield is as long as it’s improving and that it hits or exceeds industry norms before they go bankrupt. The mere fact that they have a bad FPY is more indictative of how fast they are scrambling to get this production line going, but if they catch the errors before the cars go out the door then it’s simply an expense they’d damn well be reducing as time goes on. Tesla has had shaky launches on every other platform they’ve released but now they manufacture the S and X platforms effectively. If they can get past the rough period with the Model 3 they will have three high demand platforms they are producing in volume. That’s something I believe they can do, which is why I’m a shareholder.
- karpodiem 8y ago"they will have three high demand platforms they are producing in volume." This is false. S & X sales are flat/slightly decreasing - http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-s/ http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-... Tesla is in awful financial shape - https://seekingalpha.com/article/4195452-bulls-may-noticed-teslas-growth-story-dead https://seekingalpha.com/article/4195452-bulls-may-noticed-t... Tesla is on the verge of bankruptcy.
- TaylorAlexander 8y agoI see by your figures that you’re correct, sales of the S are flat. However it seems they are selling more luxury sedans than their competition so flat sales do not mean it’s not high demand. Do note that their quarterly delivery rates are increasing. Ostensibly from Model 3. Q2 2015 11,532 Q3 2015 11,603 Q4 2015 17,400 Q1 2016 14,820 Q2 2016 14,370 Q3 2016 24,500 Q4 2016 22,200 Q1 2017 25,000 Q2 2017 22,000 Q3 2017 26,150 Q4 2017 29,870 Q1 2018 29,980 Q2 2018 40,740 https://www.statista.com/statistics/502208/tesla-quarterly-vehicle-deliveries/ https://www.statista.com/statistics/502208/tesla-quarterly-v...
- taneq 8y agoYou don't think some of the Model S sales have just gone on high end Model 3s?
- yread 8y agoMain issue seems to be quality of Model 3s and > Tesla’s pitch for several years has been that the company will grow to 1 million unit in sales in 2020. With a potential future China factory not producing any meaningful quantities of cars until 2021, investors need to downgrade the growth prognosis from 1M cars in 2020 to 600K cars in 2021.
- Cyph0n 8y agoIs it normal for a public company to be so beholden to the whims of its CEO?
- jnmandal 8y agoHe is also a very large shareholder
- minimaxir 8y agoUsually, the Board is a check on the CEO. Usually.
- saudioger 8y agoApple was from time to time, but Jobs fortunately lived and died before the time where people said anything that came to mind on Twitter so it seemed much more tame.
- h4b4n3r0 8y agoWho would you replace him with without the value of the company diving off a cliff?
- twunde 8y agoFairly often, especially for founding CEOs since so much of the company tends to be tied to the founders. And generally when a founder CEO is ousted there's two reasons: 1) there's an incredible amount of bad press (think of Uber and Travis or Papa John's John Schnatter) or 2) the board/investors think that they need to replace the founder with an experienced CEO (think Google). Here, only the first applies.
- fermienrico 8y agoThere is not a shred of apology for his tweet that caused havoc on Wall Street - but big and small investors were totally taken aback.
- fredch 8y agoIt's a lot of trouble to go through to get people to forget you called some Thai firefighter a pedo on Twitter...
- rhema 8y ago> That said, my belief that there is more than enough funding to take Tesla private was reinforced during this process. Is this some kind of threat or positioning towards actors somewhere? Is this like someone in a relationship saying, "I know I be with someone else if I wanted to, but this is working out for now."? What's the point of all of this, besides saying that Tesla has lots of funding options?
- dforrestwilson 8y agoThis past week was about covering the legal angles so that Elon doesn’t go to jail while still attempting to mollify bulls.
- tedunangst 8y agoBlame the shorts, blah, blah. "I could totally squeeze the shorts at 420 but I won't because I don't care even one bit about the shorts."
- mdorazio 8y agoIt's almost certainly an attempt to stave off the SEC investigation into misleading statements by Elon when he tweeted originally that funding was secured.
- meritt 8y agoIf Tesla was actually going private his "Funding Secured" tweet wouldn't be viewed with as much scrutiny. Instead, coupled with his on-going public threats against short sellers, that tweet is now even more likely to be viewed as intentional market manipulation. This will only continue and reinforce the SEC investigation.
- karpodiem 8y agoThis does this opposite. This is the opposite of 'funding secured', because now he has to PROVE that funding actually was secured. It wasn't.
- freerobby 8y agoIt reinforces the narrative that this was his choice about what is best for Tesla, and not a market-driven outcome to remain public in spite of a desire to privatize.
- redisman 8y agoElon needs a vacation. Any employee would've been fired for this kind of behavior.
- zaroth 8y agoI agree, both true. But it would be a terrible shame if Tesla lost Elon. His is a tremendous asset, even though he doesn’t always make the best choices.
- neom 8y agoKnock a bunch of shorts over and take a slap on the wrist, wonder if this was a calculated business move?
- minimaxir 8y agoAny outcome of an SEC investigation isn't a slap on the wrist, and that's not even counting civil investor lawsuits.
- neom 8y agohttps://www.cornerstone.com/GetAttachment/2cd97eeb-1a32-4b51-83ba-7c5624e77318/Securities-Lawsuits-Settlement-Statistics-for-10b.pdf https://www.cornerstone.com/GetAttachment/2cd97eeb-1a32-4b51...
- minimaxir 8y agoI'm not sure why you linked a 1997 PDF.
- neom 8y agoTo give you an idea of what a 10b-5 violation looks like. I assure you, there isn't a cost of living increase for SEC violations since 97, this is precedent and having spent the day trying to understand if I'd make this business move, I still hold firm that a 10b-5 violation won't run more than $20-50mill very worst case. a wrist slap.
- hendzen 8y agoLove that this was posted at 11PM EST on a Friday. Almost like they wanted it to go unnoticed :D
- habitue 8y agoThis is the responsible thing to do, and what he should have done with the original "announcement". If you announce it after market close on a Friday, there's plenty of time for traders and institutions to chew on it before the opening bell Monday.
- tptacek 8y agoTo understand the hilarity of this statement you really want to have read the last 3 Matt Levine posts about the saga of Musk's "plan" to take Tesla "private" while retaining the majority of its existing retail shareholders. I think Bloomberg has paywalled Levine now; he's worth it (I mean, he is in supremely excellent form discussing Musk's "going private" plan), but I subscribe to him via email and get them free. Maybe someone here has a link to them; they are fantastic.
- Lx1oG-AWb6h_ZG0 8y agoHere are a few of the articles, in order. Bloomberg restricts you to 10 links a month, but you should be able to access them: https://www.bloomberg.com/view/articles/2018-08-08/elon-musk-has-some-fun-with-tesla https://www.bloomberg.com/view/articles/2018-08-08/elon-musk... https://www.bloomberg.com/view/articles/2018-08-09/musk-s-money-mystery-intrigues-sec https://www.bloomberg.com/view/articles/2018-08-09/musk-s-mo... https://www.bloomberg.com/view/articles/2018-08-13/funding-for-elon-musk-s-tesla-buyout-wasn-t-so-secure https://www.bloomberg.com/view/articles/2018-08-13/funding-f... https://www.bloomberg.com/view/articles/2018-08-17/elon-musk-is-working-too-hard https://www.bloomberg.com/view/articles/2018-08-17/elon-musk... Again, these are highly recommended and give you a glimpse of this entire farce from the finance perspective.
- Luc 8y ago> Bloomberg restricts you to 10 links a month (Not if you open them in a private window)
- spindle 8y agoOoh. That is a fantastic tip. Thank you.
- QuantumGood 8y agoI read most of the last article, and he indicates "harm" must be things like "murder", and since short sellers aren't killing they can't be doing anything that would be equated with causing harm. There's a little more gray area to "harm" than just "murder". Severe logical fallacy here.
- dia_ton_dia_ton 8y agoWhat does this mean for the stock price? Sell off?
- zerealshadowban 8y agoMany opine that Musk deserves punishment at the hand of the SEC. I disagree, profoundly. His post appears to have been ill-considered, may have been wishful thinking, was possibly driven by spite, and/or even written under the influence of drugs. So what? the government has no constitutional power to threaten or punish people for what they say nor for what they think apart from what they say, except for a few extremely limited instances such as a direct threat of force or libel. The SEC embodies the modern drift of the administrative state at its worst; its many regulations are not laws passed by Congress, which is the only branch empowered to write legislation. One of the most famous and often used SEC rules is Rule 10b-5, which "prohibits fraud in securities transactions as well as insider trading." Fraud is a form of crime, but trading on one's knowledge involves neither force nor fraud and is simply a manifestation of our basic rights to talk and trade, regardless of what others may or may not know. The proper rule of markets since Roman time is "Caveat Emptor"; don't rely on nor seek to control or punish the morass of conversations at the local inn or at Twitter. Many thoughtful economists and political philosophers suggest that by and large all of the federal securities laws (originated as part of the New Deal in the 1930s) should be abolished. It may be worth considering, when one small online comment becomes fodder for public calls to have the government severely punish a CEO.
- ewoodrich 8y agoHe is the CEO and made a materially false statement, while the market was open and investors who believed him bought at a high of $380 based on a promise of a buyout at $420, only to have it plummet days later. The odds are pretty good that it will dip further when markets open Monday. Actions have consequences.
- buttcoinslol 8y ago> The SEC embodies the modern drift of the administrative state at its worst; its many regulations are not laws passed by Congress, which is the only branch empowered to write legislation. The SEC is empowered by Congress to enact regulation, see the Administrative Procedure Act. Anyways, as a director of a publicly traded company, Elon Musk is well aware of information disclosure rules. Your argument is couched in libertarian fantasy, not reality.
- IBM 8y agoThe Tesla episode on Dirty Money is going to be lit.
- a13n 8y agoAny particular reason this thread is getting pushed off the front page? It has twice as many votes as something else above it that is 5x older.
- Animats 8y agoMusk still has an "only I can do it" mindset. The guy is working himself too hard, not getting enough sleep, and making bad decisions. As CEO, he should not be trying to fix an assembly line. His job is to build a team to do that, give them enough authority to do the job, get out of their way, and check up on them occasionally. Here's Tesla's top management, according to Tesla.[1] There's Musk. There's a chief financial officer. And there's a chief technical officer who's a battery electric powertrain expert. Where's the chief operating officer? There's a VP for manufacturing, Gilbert Passim. But check out his Linkedin page.[2] He's listed as running Tesla's various operations other than direct vehicle production. When he was hired by Tesla in 2010, he was relocated from Pleasanton to southern California. There must be a plant manager and a head of manufacturing engineering, but they seem to be far enough down that they have zero Google visibility. It looks like Musk set this up so that there's him, and then there's a bunch of people who report to him, none of whom has full authority over manufacturing. It's not working. [1] http://ir.tesla.com/corporate-governance/management http://ir.tesla.com/corporate-governance/management [2] https://www.linkedin.com/in/gilbert-passin-74a36117 https://www.linkedin.com/in/gilbert-passin-74a36117
- shawn 8y agoBut it seems to be working, right? Tesla has been hitting their goals, and the stock price has been going up. Musk's bizarre behavior is concerning, but his organization structure seemed to be working.
- slivym 8y agoSorry but Tesla is not meeting its targets. It has a phenomenal reputation for missing targets repeatedly and finally hitting them in a 'kind of' style. The 5000 is the obvious example - they missed the target by almost a year, had to build a separate outdoor production line (which means the numbers are no longer reflective of their production line) and it turns out their first pass rate was something like 14%. Tesla is not bankrupt, and it's producing some cars. Its stock price is high. If those are the only criteria you have for success then fine. But they're not successful on the terms that they themselves set.
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- sidcool 8y agoI am surprised this did not remain on the front page long enough.