8 ms·

Tesla Is Doing Much Better Than Headlines Suggest

97 points by kartikkumar 8y ago

roywiggins 8y ago
The Kochs didn't make Elon tweet himself into an SEC sanction "Musk and the Tesla board have decided to keep Tesla public." Decided as in there was no plan in the first place
- Latteland 8y ago
  Yeah, that was stupid and an unforced error. Anyway, that seems to be close to being closed.
throwaway2016a 8y ago
I actually really want to buy a Model 3 but these stories that Tesla has a bridge note due in March that they may not be able to cover have me concerned. If I buy a car I want to make sure the company is around to service it. I don't see this article covering that particular article. In fact the word "debt" appears nowhere in it. Edit: I'm actually asking someone to prove the debt issue wrong if they can. It is literally the only thing keeping me from buying.
- sabareesh 8y ago
  I am thinking all the other car makers going to be extinct. All the other auto makers are struggling now to make mass market electric car and 90 % that is going to be the future for good.
- cowmix 8y ago
  Huge Tesla fan here but this is the one thing that has me up at night too. I would like someone to "show me the way" on this topic too.
- lozaning 8y ago
  I hope Tesla succeeds, but I cant deny I'd love to pick up a 3 on the super cheap because Tesla went belly up.
  - MrEfficiency 8y ago
    This sounds good until you realize you bought a first generation vehicle(unreliable parts) and a company that is no longer producing them.
    - wil421 8y ago
      It’s a serious concern. I bought an special anniversary edition of a car, had something hit me on the highway a month after, and had to wait a month for the manufacturer to make the special parts.
    - microtherion 8y ago
      But surely Tesla's vast dealer network would remain available to perform any maintenance for the indefinite future </s>.
    - stephengillie 8y ago
      This must be reflected in insurance rates. How much more does it cost to insure a Model 3 than a Camry?
    - tardo99 8y ago
      It's very unlikely that Tesla will disappear. The bear/short case here is just that the stock goes to $0 because it's overvalued. The company will not die.
    - lozaning 8y ago
      Nah, Im going full Rich rebuilds style. Buy 3 of them for a couple grand each, frankenstein them together into one working vehicle. Not rooting for Tesla to go out of business, but the result of it could be a ton of cheap EV parts hitting the market.
- bfwi 8y ago
  The CEO has shown willingness to fund Tesla Motors and SpaceX with almost all his personal funds. If I remember correctly, he is worth more than Tesla's debt, and unless he is somehow unable to liquidate enough assets to cover that debt, it won't be the end of Tesla.
  - JumpCrisscross 8y ago
    > he is worth more than Tesla's debt Most of Elon's net worth is in illiquid SpaceX stock and Tesla shares.
    - bfwi 8y ago
      Why is the Tesla stock illiquid? It's publicly traded. I'm sure he could sell SpaceX stock on the secondary market quite easily. SpaceX has never lacked in interest from investors.
      - JumpCrisscross 8y ago
        > Why is the Tesla stock illiquid? It's publicly traded. Pardon me, imprecise phrasing. SpaceX stock is illiquid. Tesla stock is liquid, but if Tesla is having financial difficulties its stock will go down. If Elon can sell Tesla shares, Tesla can sell Tesla shares. > I'm sure he could sell SpaceX stock on the secondary market quite easily Not "quite easily". One, he's a super material insider. That makes the process more complicated for everyone involved. (It would be difficult to avoid giving everyone else the right to participate on the same terms.) Two, he's a super material insider. The fact that he's selling will scare away many buyers. Three, he's a super material insider. His selling SpaceX stock to prop up Tesla screams that nobody is willing to finance Tesla in the open market. It would immediately lead to a rout.
        bfwi 8y ago
        I'm not convinced that selling some of his SpaceX stock on the secondary market is difficult, or that selling some of his Tesla stocks would cause a rout, especially when the immediate consequence would be paying back the debt, thereby saving the company. But I hope some experts (e.g. stock analysts) would comment on this scenario, I think it's interesting.
- nickik 8y ago
  Its extremly unrealistic that this would happen. First of all, with the Model 3 sails they now have a huge revenue stream. Secondly, I think its pretty unquestionalble that they could easly raise more money. If they were willing to issue more stock.
- tssva 8y ago
  The note due in March is convertible. They can cover it with cash, issuing stock or a combination of the two. It should be a concern for stock owners because it might mean dilution of their position but shouldn't be a concern as far as being a company ending event.
  - jonknee 8y ago
    > They can cover it with cash, issuing stock or a combination of the two. They're convertible notes with a fixed conversion rate, Tesla doesn't get to decide on what the noteholder wants. If the stock price isn't high enough whoever is holding the notes will demand cash (cash that Tesla doesn't have).
    - alonmower 8y ago
      I think the above comment was claiming that they could issue stock to generate the cash that they'd use to pay back the convertible notes with
      - jonknee 8y ago
        On the second quarter call this year, Elon Musk stated: > “We’ll not be raising any equity at any point... I have no expectation of doing so; do not plan to do so.” Issuing new shares would be a disaster. Far more likely is they come up with a way to roll the debt forward.
  - smogcutter 8y ago
    And presumably that risk is already priced in to the stock. It's not as if investors will be caught be surprise.
- _ph_ 8y ago
  A very important milestone will be the numbers for Q3, which will be announced early November. If Tesla is, as expected, no longer loses significant amounts money or even is slightly profitable, the outlook should be very good. The Model 3 production volume is up, there should be some volume increase in Q4 and that means a lot of revenue. Based on that, renewing the credit shouldn't be too difficult in March. The credit due is about 900 million, while Tesla has a quarterly revenue of more than 5 billion.
- paulornothing 8y ago
  That never once crossed my mind, and doesn't bother me now. I've only had my 3 for two weeks and I'm definitely happy I didn't buy a new Audi A4 instead.
- omgwtfbyobbq 8y ago
  If you're worried, I'd wait until the Q3 earnings call early next month. Their short term finances mostly hinge on the Model 3's margin.
iamgopal 8y ago
Theirs is 50 percent profit business. Only matter is, it will take time to zeroing their debt.
- blang 8y ago
  I've never seen that number before, any source?
- twblalock 8y ago
  Tesla aims for a 25% profit margin on the Model 3 and is not there yet: https://www.cnbc.com/2018/05/21/tesla-shares-to-soar-on-strong-model-3-profitability-analyst.html https://www.cnbc.com/2018/05/21/tesla-shares-to-soar-on-stro... From what I can see, the margins on the other models are similar. And the company still loses money overall.
  - AtlasBarfed 8y ago
    May? That's pretty old. https://www.teslarati.com/tesla-model-3-solidly-profitable-sandy-munro/ https://www.teslarati.com/tesla-model-3-solidly-profitable-s... That is more recent (July) and shows 30% on the long range, without dual motor or performance bumps, all of which are probably really profitable add-ons. Of course who knows who is paying this guy to do the teardown/sourcing for the article. I'm guessing the 35k version rolls out when it becomes profitable to do so to keep on target with the debt payments.
enraged_camel 8y ago
Tesla's biggest problem right now is Elon and all the negative publicity he generates. I think the stress and lack of sleep and crazy long hours are finally getting to him, resulting in outrageous behavior that has become a severe liability for Tesla. Just a year ago I would never have thought I would say this, but perhaps he needs to step aside and hand the reins over to a talented COO-type like with Gwynne Shotwell over at SpaceX. edit: of course I'm getting downvoted for saying bad things about Elon on HN. Oh well, I've got karma to kill, so bring it on. :)
- tarboreus 8y ago
  This is probably availability bias. You read about his gaffes but you have no exposure to what he actually does inside the company.
  - enraged_camel 8y ago
    That's the thing though: why do we have no exposure to what he actually does inside the company? You would think that Tesla would put in some effort to generate positive PR for their CEO to counter his nonsense. Why aren't they?
- sabareesh 8y ago
  Impossible things achieved by Tesla when company is going so quick I think it is common . https://cleantechnica.com/2018/10/14/8-impossible-goals-tesla-achieved/ https://cleantechnica.com/2018/10/14/8-impossible-goals-tesl...
prostoalex 8y ago
As much as I'd like the company to succeed, it seems frivolous to dismiss the concerns as short sellers' PR projects and media's desire to drive traffic through clickbait. Bond markets are largely dominated by institutional players who've seen every PR trick in the book, pay astute attention to fundamentals in hopes of finding a minuscule mispricing opportunity, and even they are not treating TSLA positively https://money.cnn.com/2018/09/10/technology/business/tesla-stock-bonds-elon-musk/index.html https://money.cnn.com/2018/09/10/technology/business/tesla-s...
- Fuckyourself 8y ago
  No one is dismissing concerns, this article was simply made to point out that there has been a never ending cascade of negative stories about tesla and a lot of people want it to fail.
- jsight 8y ago
  OTOH, some of those same investors know that not all tricks are aimed at them, and some tricks are effective. In this very thread, we have people who are hesitant to buy the car due to solvency concerns: https://news.ycombinator.com/item?id=18222268 https://news.ycombinator.com/item?id=18222268 Car companies and rumors of solvency issues can often turn into real solvency issues due to the nature of the automotive business and the impact of rumors on sales.
- AtlasBarfed 8y ago
  Does that show the debt servicing costs vs the expected profitability of the current production pace? The August/September production numbers were pretty robust, and given the profit margin on the current models I could see the debt being serviced. The tweets and executives leaving are just drama. Tesla will make or break on the production rate and the profitability per car, both of which seemed on target, but I haven't seen definitive numbers.
  - threeseed 8y ago
    > Tesla will make or break on the production rate and the profitability per car Sure. For now. But every car company is releasing electric cars over the next few years. Many of which look like serious threats against Tesla's more profitable models. Electric as a differentiator will disappear and all that will be left is (a) brand, (b) design, (c) quality, (d) service. None of which Tesla is better than its competitors at. And you need executives around to be able to resolve this.
throwawayosiu1 8y ago
Just as a note, the author is from CleanTechnica. They are known to be extremely pro-tesla. Best case scenario - most of their articles quietly ignore the downside and prop up the upside. Worst case - they lie or embellish the truth. Disclosure: I've followed both bulls & bears for almost 6 months - and I've got quite a lot riding in short positions.
- Fuckyourself 8y ago
  I hope you get burned really hard and spend your days on r/wsb/ for being a fucking dummy. Disclosure: I've followed both bulls & bears for almost 6 months - and I've got quite a little in long positions.
- AtlasBarfed 8y ago
  I saw a graph on one of the pro-Tesla sites that basically showed that the Tesla debt is to scale with the rampup of the Model 3 production, and that it isn't out of proportion for the scale of what the production scale of the Model3. And the scale now is above profitability. Is that not true?
  - gamblor956 8y ago
    That is not true. Tesla still hasn't paid off its debt from the Model X, the Model S, the Gigafactory, or the Supercharger network. They might have managed to achieve positive cash flow with respect to Model 3 specific investments, but that doesn't mean they generating anywhere near the level of cash they need to pay off past debts.
    - Latteland 8y ago
      I think that is an arguable point and at least we don't know what their profits are, but we'll know better after q3 earnings are out. If they are making the claimed 25-30% margin on current model 3's, making 50k of them a quarter at avg price of 60k, 50k60k.25, that's a car profit $750 million/quarter. That will pay down their debt at a rate 3 billion a year. I think this is why they said after q3 they will start being a real company, with q3 and q4 at the current rate they could be profitable and actually pay off debt. If all else fails they could sell more stock right now, but that only goes so far. I think they will make a significant profit by q4, and probably a good profit in q3.
sokoloff 8y ago
> Tesla has achieved enormous results in ramping up its Model 3 production faster than almost any new model car in history. That defies my gut feel, so I checked on carsalesbase to confirm/refute. Nearly any new car model that I look at far outsells the Model 3 during new model ramp up... http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-3/ http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-...
- calyth2018 8y ago
  How dare you fact-check an article? ;)
- JumpCrisscross 8y ago
  The author describes himself as a cleantech and blockchain reporter [1]. [1] https://medium.com/@michaelbarnard_46445 https://medium.com/@michaelbarnard_46445
  - MrEfficiency 8y ago
    I've firmly started believing in the phrase Bitcoin not Blockchain and dismissing anyone who thinks we should be storing database data in a blockchain. Its 2018, we found its expensive and slow to use blockchain, don't store stuff that doesnt need to be trustless.
  - gumby 8y ago
    He's also delighted to have been "mentioned in four books"
  - kbenson 8y ago
    > blockchain reporter I wonder if the general public has as negative a connotation of blockchain reporter as I assume most HN readers do.[1] 1: Even if you're bullish on blockchains, I don't think it's a stretch to say that blockchains reporters are not unfamiliar with overhyping news.
- jaawn 8y ago
  Which models did you look at? I don't remember a lot of models that are new to the market recently. I checked the Mazda CX-3 and the Nissan Leaf, and the Model 3 does appear to have crushed both of those based on first year numbers.
ed_balls 8y ago
And this is a bad article as well > The company is massively outselling its competitors in North America How can you compare Tesla models to BMW 7? It should be compared to BMW5. What is more, SUVs rule the market and that's where they main focus is (Audi e-tron, Mercedes EQ etc.)
- FireBeyond 8y ago
  The 3 is more comparable to a BMW 3 series.
  - reissbaker 8y ago
    The Model 3 became the fifth best selling car in North America in Q3. Take a look at the sales numbers for any car BMW makes that you want — the Model 3 beats all of them. The only cars that outsell them are the Honda Accord, Honda Civic, Toyota Camry, and Toyota Corolla. And it looks to be on track to become the fourth best selling car as of current sales numbers.
kolderman 8y ago
But mah short stocks :{
superfrank 8y ago
This article seems to be saying that Tesla is in a good place because they build good, popular cars and electric vehicles are the future. Maybe, I'm reading different news stories than the author, but I don't feel like those are criticisms of Tesla that I'm seeing anymore. Pretty much every current news story I'm seeing is either focusing on Tesla running out of money because their cars aren't profitable enough, or the fact that Elon's behavior on Twitter is hurting the company. The author addresses neither of these points. Sure, maybe a few years ago I could get behind the idea that the Koch bothers are spending billions of dollars to try and suppress the electric car industry. But currently, pretty much every major car company has some sort of electric offering and many are making commitments to be fully electric in the near future. Even if the Koch's are spending money to hurt the electric car industry, it seems like they are fighting a losing battle. Honestly, this whole article reads like a straw man argument.
- jsight 8y ago
  I am a fan of Tesla who feels like a lot of the coverage has been really unfair. I still largely agree with the point that you are making, and I don't really consider this article to be better than some of the "bear" case articles that I have seen from time to time for the past few months. Having said that, I think it is also a little unfair to imply that the work that the (???) are doing to try to push a false narrative and to get that narrative into the press has been unsuccessful. I'm honestly not even sure what to call these people. Are they really shorts in all cases? Maybe call them the twitter-geniuses-who-use #tslaq a lot? An example is this article: https://www.nytimes.com/2018/10/01/business/tesla-cars-questions.html https://www.nytimes.com/2018/10/01/business/tesla-cars-quest... Despite the title, did that article actually unravel the mystery? Or did it just devolve into unsupported claims of soft demand and quality issues, along with a poor job of setting an appropriate baseline for how much inventory a typical auto-maker would have in-transit? I wouldn't attribute it to malice, but would these poorly researched articles exist were it not for the "tslaq" crowd stuffing "tips" to friendly reporters? And do they have something to gain from such mediocre work?
- agumonkey 8y ago
  The Tesla profitable article wave seems done. They seem to have managed to scale just enough and just stable enough to unfold orders which was already a risk a year ago.
jonknee 8y ago
Anyone who has eyes can see that there are lots of Tesla vehicles on the streets wherever there are lots of wealthy people. That has never been a question or something that headlines suggest. The problem is Tesla sells these cars for less than it costs to build them and have had trouble making enough of them with a build quality matching the luxury price tag. Short sellers will magically go away if Tesla can start to consistently make money by selling cars, until then nothing matters. If you haven't read it already, don't waste time reading this article.
- stephengillie 8y ago
  Supposedly, Tesla's cars themselves sell for more than their production cost. The loss comes in supporting Tesla-as-a-fuel-reseller* - aka the Supercharger network. It would be like if Toyota started opening gas stations, and Camrys and RAV4s and Siennas and Tundras got almost-free gasoline. While these businesses are complementary, they're very different operations, and should at least be in separate business units, if not a subsidiary or partnership with an existing fuel supplier. *Electricity of a specific voltage and amperage is now a motor vehicle fuel.
  - jonknee 8y ago
    Any source for this? The Supercharger network is no longer free (at all for Model 3, 400 kWh in annual credit for Model S/X), but either way it was and still is a heavily marketed feature of Tesla vehicles so you can't ignore the cost. They need to make money or they will go out of business.
adamkittelson 8y ago
They're really struggling with delivery logistics though. I was scheduled to pick up my Model 3, which will be my 3rd Tesla, this Wednesday. I've been hounding them for my bill of sale because the bank needs it before they'll send a check. I called the local delivery center again this morning and they informed me they gave my car to another customer. They didn't bother to let me know about this or the home office so they could begin looking for another VIN to assign to me. Apparently I was just supposed to show up on Wednesday and find out they didn't have a car for me then. I've also already taken out insurance for the VIN they gave me and provided it to my bank so now I have to redo all that whenever they get around to giving me another VIN and hope they don't give that car away too. My first two delivery experiences were great but now I'm starting to think I'd get a better experience working with a traditional dealership.
- ryanhuff 8y ago
  I suspect as they fix one issue (production, etc), the next in line becomes the bottleneck. Now it’s delivery logistics, but once that’s fixed, it will become service, which already seems to be straining.
  - threeseed 8y ago
    Companies around the world are building, shipping and supporting products simultaneously. Really confused why Tesla can't do the same.
    - Kliment 8y ago
      The way I understand it what the previous poster was saying was that they're building a high-volume pipeline which is likely to have issues as it's new to them, and the delivery issues can't show until there's sufficient volume coming in from manufacturing, and the service problems can't show until there's sufficient volume of vehicles delivered.
    - Latteland 8y ago
      Tesla doubled their production last quarter, and everything else needs to double, and they are having trouble. The reason 'other car companies' can do better is because Ford or Porsche are stabile companies, with a slow change in the number of vehicles over time. They are more organized than tesla for sure, and they know how to change manufacturing lines when a new model comes out, way better than the young pup tesla. But ford doesn't double production every quarter like tesla is doing now; one model might change but overall production, sales, support staff doesn't change. Ford has some amount of slack available, but I doubt they could double production from one quarter to the next and just be okay. At least tesla has shown their delivery was not up to the job. The factory is handling it, but struggling. Anyway, if I got a new car, tesla or now, I'd want it to be well made and for there to be enough salespeople and support and finance and repair staff to handle me - tesla is sucking wind trying to handle all the new customers. At the same time, they are also on full production of new supercharging stations all across the us and the world.
stevespang 8y ago
As the article states: The Koch Brothers During 2015, their network of fossil-fuel CEOs worked together create and fund an advocacy organization with $10 million USD in February of 2016. The organization launched in August of 2016 as: Fueling U.S. Forward. BIG OIL's disinformation campaign to destroy Tesla
jseliger 8y ago
This article is especially interesting in light of "Can We Go Electric Before It’s Too Late?" https://www.citylab.com/transportation/2018/10/where-americas-charge-towards-electric-vehicles-stands-today/572857 https://www.citylab.com/transportation/2018/10/where-america.... The answer may be "no," but Tesla is a big part, and outside of China likely the biggest part, of the answer.
- Animats 8y ago
  China is aggressively going electric. Shenzhen went with all electric buses last year. Getting a permit for a car in Beijing is far easier for an electric car. China's electric car production is 3x US production.[1] Yes, many of them are small city cars, but then, they're used for getting around big cities. [1] https://qz.com/1303594/when-it-comes-to-making-electric-cars-theres-china-and-everyone-else/ https://qz.com/1303594/when-it-comes-to-making-electric-cars...
  - seanmcdirmid 8y ago
    Ya, you’ll see lots of Tesla’s in Beijing these days because of the lottery, even though they cost 2X what they do in the states (rich Chinese don’t want to be seen driving around in a BYD).
dwighttk 8y ago
Article could really use a disclaimer clarifying if the author owns stock in Tesla.
tardo99 8y ago
A company can be doing well and have its stock massively overvalued at the same time.
csours 8y ago
Disclaimer up front: I work for a Tesla competitor, any opinions are solely my own. From the linked article: > "And now NHTSA testing shows that the #1, #2 and #3 cars with the lowest likelihood of injury in a collision are the Tesla Models 3, X and S in that order." https://www.cnet.com/roadshow/news/tesla-model-3-nhtsa-safety-claims/ https://www.cnet.com/roadshow/news/tesla-model-3-nhtsa-safet... https://www.nhtsa.gov/press-releases/national-highway-traffic-safety-administration-issues-statement-about-new-car https://www.nhtsa.gov/press-releases/national-highway-traffi... > "NHTSA does not distinguish safety performance beyond that rating, thus there is no "safest" vehicle among those vehicles achieving 5-star ratings." Perhaps stop making claims that are not backed by the source you claim to use.
- 1123581321 8y ago
  The CNET article you linked says: “Over email, a Tesla spokeswoman did offer more explanation on the probability-of-injury statistic. NHTSA compiles raw injury data in a load of spreadsheets every year, and it computes the overall probability of injury, listing it as a Vehicle Safety Score in its published results. That's where Tesla pulled the data from, and you can check this year's results for yourself on regulations.gov.” It seems that NHTSA is only disputing that they hand out an official “safest vehicle” rating, not that Tesla did that well in their data. I would say that the claim is backed up if going by the actual results and not the capped, publicized rating. I’m curious what you thought when you came across that part of the article.
  - dwighttk 8y ago
    Man regulations.gov is a terrible site. The only document I could find that contained "vehicle safety score" was: https://www.regulations.gov/document?D=NHTSA-2015-0119-0001 https://www.regulations.gov/document?D=NHTSA-2015-0119-0001
    - csours 8y ago
      It's linked from the CNET article: https://www.regulations.gov/docket?D=NHTSA-2017-0037 https://www.regulations.gov/docket?D=NHTSA-2017-0037
mapgrep 8y ago
I decided to just look into an assertion from the first paragraph of this post: "NHTSA testing shows that the #1, #2 and #3 cars with the lowest likelihood of injury in a collision are the Tesla Models 3, X and S in that order." This is linked to a news article on "CleanTechnica," sourced to the Tesla corporate blog. Notably, the blog does not claim that these vehicles are #1,2,3 in the rankings, but rather that in prior tests the X and S models were found to have "the lowest and second lowest probabilities of injury of all cars ever tested." But it turns out NHTSA disputes even Tesla's more mild assertions: "A five-star rating is the highest safety rating a vehicle can achieve," the agency said in the statement, which did not name Tesla. "NHTSA does not distinguish safety performance beyond that rating, thus there is no 'safest' vehicle among those vehicles achieving five-star ratings." https://autoweek.com/article/car-news/nhtsa-downplays-teslas-statements-model-3-crash-ratings https://autoweek.com/article/car-news/nhtsa-downplays-teslas... In 2017, just over 30 cars attained 5-star ratings: https://www.safercar.gov/Vehicle-Shoppers/my2017_5_star_tests https://www.safercar.gov/Vehicle-Shoppers/my2017_5_star_test...
- kbenson 8y ago
  > But it turns out NHTSA disputes even Tesla's more mild assertions: I think it's worth noting that neither are contradicting each other, as they are saying different things. Tesla says NHTSA testing shows something, which may have nothing to do with specifically what the NHTSA says or how it rates. If they have access to the actual test data (or the tests are publicly available), they can make assertions off that data. If that was the case, the NHTSA is clarifying its position, in that it is not making those claims so them saying "NHTSA does not distinguish safety performance beyond that rating, thus there is no 'safest' vehicle among those vehicles achieving five-star ratings." is a way of clarifying their position and staying neutral, since they haven't made that assertion for any other vehicles in the past. In other words, it's possible for them both to be be correct and accurate, but talking about slightly different things. This doesn't even require intent to deceive from either party. I, of course, have no idea if that's true and this is the case. It is one possible way to interpret the statements though, so a little additional investigation might be warranted before we determine that either statement is false or intentionally misleading.
Animats 8y ago
Tesla still isn't doing all that great on production.[1] They've been unable to sustain the 5,000 units a week output for the Model 3 line. They're back down around 4,000. The week to week numbers are all over the place, from 2000 to 6000. Auto plants are usually much more consistent. A Ford exec points out that their F-150 production line at the Rouge produces a truck every 55 seconds. You can take the plant tour in Detroit and see this. Tesla's open-ended tent setup in Fremont isn't going to work once rainy season starts. Their production problems should have been fixed by now, but clearly they're still struggling. And, as Bob Lutz says, they have way too many people in the Fremont plant. Tesla has 10,000 workers in Fremont. Ford's entire Rouge complex has about 5000 workers. Tesla has accomplished a lot, but the core business still isn't running smoothly. [1] https://www.bloomberg.com/graphics/2018-tesla-tracker/ https://www.bloomberg.com/graphics/2018-tesla-tracker/
- _ph_ 8y ago
  First of all, we don't know whether the production is "all over the place". Your are quoting the weekly numbers from the Bloomberg tracker. But this tracker does not know about actual production numbers. It mostly looks at VIN allocation, which is not directly coupled to production numbers. Typically, Tesla allocates about 30% more VINs than the production numbers. Based on that, Bloomberg came close to the total quarter production number, but it does not give information about the weekly production numbers. We only know the average production number of over 4000 cars/week. Tesla has more workers in their Freemont plant, but they have a very high vertical integration. They are producing their own seats for example.
  - Animats 8y ago
    Ford's Rouge plant has a steel mill. Iron ore comes in via barge. They have a glass plant. A power plant. A casting plant. An engine plant. Now that's vertical integration.
    - reissbaker 8y ago
      Ford also sold (far) fewer cars of any model in North America than Tesla did, and is exiting the market minus the Focus Active and the Mustang, retreating to just SUVs and trucks.
danso 8y ago
Besides the problematic assertions this article makes about Tesla's business fundamentals (already addressed in the comments), I just want to call out the absurdity of its media conspiracy theory: > Media outlets are doing what they can to survive. They’re laying off seasoned journalists with strong fact-checking instincts. They’re laying off fact-checkers. They’re laying off editors. They’re rethinking how they write headlines to compete with clickbait...Tesla and Musk are big eyeball grabbers. They have been for five years, as this Google Trends graph shows. One publisher I work with regularly told me, anecdotally, that anything with Tesla or Musk in the headline is likely to perform better than average. Only someone who has his head firmly in the Tesla bubble could imagine that the eyeballs that Tesla/Musk articles attract are any kind of significant blip in the revenues or traffic of a major general news outlet. It's really hard to imagine how clueless this author is, as if he had just woken up from a 2 year nap and doesn't realize what currently dominates the headlines and reader traffic. Take this Sept. 4 article from BuzzFeed News, which arguably directly led to Musk bringing a libel suit upon himself: https://www.buzzfeednews.com/article/ryanmac/elon-musk-thai-cave-rescuer-accusations-buzzfeed-email https://www.buzzfeednews.com/article/ryanmac/elon-musk-thai-... I would bet a decent chunk of money that the reporters who worked on that story get paid more, and put more work into that article than did their colleague for this article from yesterday, "16 Bakers Who Should Be Very, Very Ashamed": https://www.buzzfeed.com/jamiejones/people-who-wont-be-winning-star-baker https://www.buzzfeed.com/jamiejones/people-who-wont-be-winni... The "16 Bakers" article has 326,000+ views, according to Buzzfeed's own metrics. The BuzzFeedNews domain does not display pageview metrics, perhaps partly to look more dignified, but also because BuzzFeed's reported articles generally are nowhere near as popular in pure pageviews as the standard Buzzfeed listicle. Moreover, the Buzzfeed listicles sell ads (the Bakers' listicle has a sponsored Uncle Ben's ad), whereas the BuzzFeedNews articles rarely have any ads. So tell me how paying quality reporters to write damaging articles about Tesla/Musk helps BuzzFeed's bottom line?
appleiigs 8y ago
Fluff article. He could've spent a moment reviewing TSLA's financial statements for facts instead of talking about conspiracies.
thewizardofaus 8y ago
But who would want to buy a car that was made in a tent?

97 points by kartikkumar 8y ago

The Kochs didn't make Elon tweet himself into an SEC sanction "Musk and the Tesla board have decided to keep Tesla public." Decided as in there was no plan in the first place

Latteland 8y ago
Yeah, that was stupid and an unforced error. Anyway, that seems to be close to being closed.

throwaway2016a 8y ago

I actually really want to buy a Model 3 but these stories that Tesla has a bridge note due in March that they may not be able to cover have me concerned. If I buy a car I want to make sure the company is around to service it. I don't see this article covering that particular article. In fact the word "debt" appears nowhere in it. Edit: I'm actually asking someone to prove the debt issue wrong if they can. It is literally the only thing keeping me from buying.

sabareesh 8y ago
I am thinking all the other car makers going to be extinct. All the other auto makers are struggling now to make mass market electric car and 90 % that is going to be the future for good.
cowmix 8y ago
Huge Tesla fan here but this is the one thing that has me up at night too. I would like someone to "show me the way" on this topic too.
lozaning 8y ago
I hope Tesla succeeds, but I cant deny I'd love to pick up a 3 on the super cheap because Tesla went belly up.
- MrEfficiency 8y ago
  This sounds good until you realize you bought a first generation vehicle(unreliable parts) and a company that is no longer producing them.
  - wil421 8y ago
    It’s a serious concern. I bought an special anniversary edition of a car, had something hit me on the highway a month after, and had to wait a month for the manufacturer to make the special parts.
  - microtherion 8y ago
    But surely Tesla's vast dealer network would remain available to perform any maintenance for the indefinite future </s>.
  - stephengillie 8y ago
    This must be reflected in insurance rates. How much more does it cost to insure a Model 3 than a Camry?
  - tardo99 8y ago
    It's very unlikely that Tesla will disappear. The bear/short case here is just that the stock goes to $0 because it's overvalued. The company will not die.
  - lozaning 8y ago
    Nah, Im going full Rich rebuilds style. Buy 3 of them for a couple grand each, frankenstein them together into one working vehicle. Not rooting for Tesla to go out of business, but the result of it could be a ton of cheap EV parts hitting the market.
bfwi 8y ago
The CEO has shown willingness to fund Tesla Motors and SpaceX with almost all his personal funds. If I remember correctly, he is worth more than Tesla's debt, and unless he is somehow unable to liquidate enough assets to cover that debt, it won't be the end of Tesla.
- JumpCrisscross 8y ago
  > he is worth more than Tesla's debt Most of Elon's net worth is in illiquid SpaceX stock and Tesla shares.
  - bfwi 8y ago
    Why is the Tesla stock illiquid? It's publicly traded. I'm sure he could sell SpaceX stock on the secondary market quite easily. SpaceX has never lacked in interest from investors.
    - JumpCrisscross 8y ago
      > Why is the Tesla stock illiquid? It's publicly traded. Pardon me, imprecise phrasing. SpaceX stock is illiquid. Tesla stock is liquid, but if Tesla is having financial difficulties its stock will go down. If Elon can sell Tesla shares, Tesla can sell Tesla shares. > I'm sure he could sell SpaceX stock on the secondary market quite easily Not "quite easily". One, he's a super material insider. That makes the process more complicated for everyone involved. (It would be difficult to avoid giving everyone else the right to participate on the same terms.) Two, he's a super material insider. The fact that he's selling will scare away many buyers. Three, he's a super material insider. His selling SpaceX stock to prop up Tesla screams that nobody is willing to finance Tesla in the open market. It would immediately lead to a rout.
      - bfwi 8y ago
        I'm not convinced that selling some of his SpaceX stock on the secondary market is difficult, or that selling some of his Tesla stocks would cause a rout, especially when the immediate consequence would be paying back the debt, thereby saving the company. But I hope some experts (e.g. stock analysts) would comment on this scenario, I think it's interesting.
nickik 8y ago
Its extremly unrealistic that this would happen. First of all, with the Model 3 sails they now have a huge revenue stream. Secondly, I think its pretty unquestionalble that they could easly raise more money. If they were willing to issue more stock.
tssva 8y ago
The note due in March is convertible. They can cover it with cash, issuing stock or a combination of the two. It should be a concern for stock owners because it might mean dilution of their position but shouldn't be a concern as far as being a company ending event.
- jonknee 8y ago
  > They can cover it with cash, issuing stock or a combination of the two. They're convertible notes with a fixed conversion rate, Tesla doesn't get to decide on what the noteholder wants. If the stock price isn't high enough whoever is holding the notes will demand cash (cash that Tesla doesn't have).
  - alonmower 8y ago
    I think the above comment was claiming that they could issue stock to generate the cash that they'd use to pay back the convertible notes with
    - jonknee 8y ago
      On the second quarter call this year, Elon Musk stated: > “We’ll not be raising any equity at any point... I have no expectation of doing so; do not plan to do so.” Issuing new shares would be a disaster. Far more likely is they come up with a way to roll the debt forward.
- smogcutter 8y ago
  And presumably that risk is already priced in to the stock. It's not as if investors will be caught be surprise.
_ph_ 8y ago
A very important milestone will be the numbers for Q3, which will be announced early November. If Tesla is, as expected, no longer loses significant amounts money or even is slightly profitable, the outlook should be very good. The Model 3 production volume is up, there should be some volume increase in Q4 and that means a lot of revenue. Based on that, renewing the credit shouldn't be too difficult in March. The credit due is about 900 million, while Tesla has a quarterly revenue of more than 5 billion.
paulornothing 8y ago
That never once crossed my mind, and doesn't bother me now. I've only had my 3 for two weeks and I'm definitely happy I didn't buy a new Audi A4 instead.
omgwtfbyobbq 8y ago
If you're worried, I'd wait until the Q3 earnings call early next month. Their short term finances mostly hinge on the Model 3's margin.

iamgopal 8y ago

Theirs is 50 percent profit business. Only matter is, it will take time to zeroing their debt.

blang 8y ago
I've never seen that number before, any source?
twblalock 8y ago
Tesla aims for a 25% profit margin on the Model 3 and is not there yet: https://www.cnbc.com/2018/05/21/tesla-shares-to-soar-on-strong-model-3-profitability-analyst.html https://www.cnbc.com/2018/05/21/tesla-shares-to-soar-on-stro... From what I can see, the margins on the other models are similar. And the company still loses money overall.
- AtlasBarfed 8y ago
  May? That's pretty old. https://www.teslarati.com/tesla-model-3-solidly-profitable-sandy-munro/ https://www.teslarati.com/tesla-model-3-solidly-profitable-s... That is more recent (July) and shows 30% on the long range, without dual motor or performance bumps, all of which are probably really profitable add-ons. Of course who knows who is paying this guy to do the teardown/sourcing for the article. I'm guessing the 35k version rolls out when it becomes profitable to do so to keep on target with the debt payments.

enraged_camel 8y ago

Tesla's biggest problem right now is Elon and all the negative publicity he generates. I think the stress and lack of sleep and crazy long hours are finally getting to him, resulting in outrageous behavior that has become a severe liability for Tesla. Just a year ago I would never have thought I would say this, but perhaps he needs to step aside and hand the reins over to a talented COO-type like with Gwynne Shotwell over at SpaceX. edit: of course I'm getting downvoted for saying bad things about Elon on HN. Oh well, I've got karma to kill, so bring it on. :)

tarboreus 8y ago
This is probably availability bias. You read about his gaffes but you have no exposure to what he actually does inside the company.
- enraged_camel 8y ago
  That's the thing though: why do we have no exposure to what he actually does inside the company? You would think that Tesla would put in some effort to generate positive PR for their CEO to counter his nonsense. Why aren't they?
sabareesh 8y ago
Impossible things achieved by Tesla when company is going so quick I think it is common . https://cleantechnica.com/2018/10/14/8-impossible-goals-tesla-achieved/ https://cleantechnica.com/2018/10/14/8-impossible-goals-tesl...

prostoalex 8y ago

As much as I'd like the company to succeed, it seems frivolous to dismiss the concerns as short sellers' PR projects and media's desire to drive traffic through clickbait. Bond markets are largely dominated by institutional players who've seen every PR trick in the book, pay astute attention to fundamentals in hopes of finding a minuscule mispricing opportunity, and even they are not treating TSLA positively https://money.cnn.com/2018/09/10/technology/business/tesla-stock-bonds-elon-musk/index.html https://money.cnn.com/2018/09/10/technology/business/tesla-s...

Fuckyourself 8y ago
No one is dismissing concerns, this article was simply made to point out that there has been a never ending cascade of negative stories about tesla and a lot of people want it to fail.
jsight 8y ago
OTOH, some of those same investors know that not all tricks are aimed at them, and some tricks are effective. In this very thread, we have people who are hesitant to buy the car due to solvency concerns: https://news.ycombinator.com/item?id=18222268 https://news.ycombinator.com/item?id=18222268 Car companies and rumors of solvency issues can often turn into real solvency issues due to the nature of the automotive business and the impact of rumors on sales.
AtlasBarfed 8y ago
Does that show the debt servicing costs vs the expected profitability of the current production pace? The August/September production numbers were pretty robust, and given the profit margin on the current models I could see the debt being serviced. The tweets and executives leaving are just drama. Tesla will make or break on the production rate and the profitability per car, both of which seemed on target, but I haven't seen definitive numbers.
- threeseed 8y ago
  > Tesla will make or break on the production rate and the profitability per car Sure. For now. But every car company is releasing electric cars over the next few years. Many of which look like serious threats against Tesla's more profitable models. Electric as a differentiator will disappear and all that will be left is (a) brand, (b) design, (c) quality, (d) service. None of which Tesla is better than its competitors at. And you need executives around to be able to resolve this.

throwawayosiu1 8y ago

Just as a note, the author is from CleanTechnica. They are known to be extremely pro-tesla. Best case scenario - most of their articles quietly ignore the downside and prop up the upside. Worst case - they lie or embellish the truth. Disclosure: I've followed both bulls & bears for almost 6 months - and I've got quite a lot riding in short positions.

Fuckyourself 8y ago
I hope you get burned really hard and spend your days on r/wsb/ for being a fucking dummy. Disclosure: I've followed both bulls & bears for almost 6 months - and I've got quite a little in long positions.
AtlasBarfed 8y ago
I saw a graph on one of the pro-Tesla sites that basically showed that the Tesla debt is to scale with the rampup of the Model 3 production, and that it isn't out of proportion for the scale of what the production scale of the Model3. And the scale now is above profitability. Is that not true?
- gamblor956 8y ago
  That is not true. Tesla still hasn't paid off its debt from the Model X, the Model S, the Gigafactory, or the Supercharger network. They might have managed to achieve positive cash flow with respect to Model 3 specific investments, but that doesn't mean they generating anywhere near the level of cash they need to pay off past debts.
  - Latteland 8y ago
    I think that is an arguable point and at least we don't know what their profits are, but we'll know better after q3 earnings are out. If they are making the claimed 25-30% margin on current model 3's, making 50k of them a quarter at avg price of 60k, 50k60k.25, that's a car profit $750 million/quarter. That will pay down their debt at a rate 3 billion a year. I think this is why they said after q3 they will start being a real company, with q3 and q4 at the current rate they could be profitable and actually pay off debt. If all else fails they could sell more stock right now, but that only goes so far. I think they will make a significant profit by q4, and probably a good profit in q3.

sokoloff 8y ago

> Tesla has achieved enormous results in ramping up its Model 3 production faster than almost any new model car in history. That defies my gut feel, so I checked on carsalesbase to confirm/refute. Nearly any new car model that I look at far outsells the Model 3 during new model ramp up... http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-3/ http://carsalesbase.com/us-car-sales-data/tesla/tesla-model-...

calyth2018 8y ago
How dare you fact-check an article? ;)
JumpCrisscross 8y ago
The author describes himself as a cleantech and blockchain reporter [1]. [1] https://medium.com/@michaelbarnard_46445 https://medium.com/@michaelbarnard_46445
- MrEfficiency 8y ago
  I've firmly started believing in the phrase Bitcoin not Blockchain and dismissing anyone who thinks we should be storing database data in a blockchain. Its 2018, we found its expensive and slow to use blockchain, don't store stuff that doesnt need to be trustless.
- gumby 8y ago
  He's also delighted to have been "mentioned in four books"
- kbenson 8y ago
  > blockchain reporter I wonder if the general public has as negative a connotation of blockchain reporter as I assume most HN readers do.[1] 1: Even if you're bullish on blockchains, I don't think it's a stretch to say that blockchains reporters are not unfamiliar with overhyping news.
jaawn 8y ago
Which models did you look at? I don't remember a lot of models that are new to the market recently. I checked the Mazda CX-3 and the Nissan Leaf, and the Model 3 does appear to have crushed both of those based on first year numbers.

ed_balls 8y ago

And this is a bad article as well > The company is massively outselling its competitors in North America How can you compare Tesla models to BMW 7? It should be compared to BMW5. What is more, SUVs rule the market and that's where they main focus is (Audi e-tron, Mercedes EQ etc.)

FireBeyond 8y ago
The 3 is more comparable to a BMW 3 series.
- reissbaker 8y ago
  The Model 3 became the fifth best selling car in North America in Q3. Take a look at the sales numbers for any car BMW makes that you want — the Model 3 beats all of them. The only cars that outsell them are the Honda Accord, Honda Civic, Toyota Camry, and Toyota Corolla. And it looks to be on track to become the fourth best selling car as of current sales numbers.

kolderman 8y ago

But mah short stocks :{

superfrank 8y ago

This article seems to be saying that Tesla is in a good place because they build good, popular cars and electric vehicles are the future. Maybe, I'm reading different news stories than the author, but I don't feel like those are criticisms of Tesla that I'm seeing anymore. Pretty much every current news story I'm seeing is either focusing on Tesla running out of money because their cars aren't profitable enough, or the fact that Elon's behavior on Twitter is hurting the company. The author addresses neither of these points. Sure, maybe a few years ago I could get behind the idea that the Koch bothers are spending billions of dollars to try and suppress the electric car industry. But currently, pretty much every major car company has some sort of electric offering and many are making commitments to be fully electric in the near future. Even if the Koch's are spending money to hurt the electric car industry, it seems like they are fighting a losing battle. Honestly, this whole article reads like a straw man argument.

jsight 8y ago
I am a fan of Tesla who feels like a lot of the coverage has been really unfair. I still largely agree with the point that you are making, and I don't really consider this article to be better than some of the "bear" case articles that I have seen from time to time for the past few months. Having said that, I think it is also a little unfair to imply that the work that the (???) are doing to try to push a false narrative and to get that narrative into the press has been unsuccessful. I'm honestly not even sure what to call these people. Are they really shorts in all cases? Maybe call them the twitter-geniuses-who-use #tslaq a lot? An example is this article: https://www.nytimes.com/2018/10/01/business/tesla-cars-questions.html https://www.nytimes.com/2018/10/01/business/tesla-cars-quest... Despite the title, did that article actually unravel the mystery? Or did it just devolve into unsupported claims of soft demand and quality issues, along with a poor job of setting an appropriate baseline for how much inventory a typical auto-maker would have in-transit? I wouldn't attribute it to malice, but would these poorly researched articles exist were it not for the "tslaq" crowd stuffing "tips" to friendly reporters? And do they have something to gain from such mediocre work?
agumonkey 8y ago
The Tesla profitable article wave seems done. They seem to have managed to scale just enough and just stable enough to unfold orders which was already a risk a year ago.

jonknee 8y ago

Anyone who has eyes can see that there are lots of Tesla vehicles on the streets wherever there are lots of wealthy people. That has never been a question or something that headlines suggest. The problem is Tesla sells these cars for less than it costs to build them and have had trouble making enough of them with a build quality matching the luxury price tag. Short sellers will magically go away if Tesla can start to consistently make money by selling cars, until then nothing matters. If you haven't read it already, don't waste time reading this article.

stephengillie 8y ago
Supposedly, Tesla's cars themselves sell for more than their production cost. The loss comes in supporting Tesla-as-a-fuel-reseller* - aka the Supercharger network. It would be like if Toyota started opening gas stations, and Camrys and RAV4s and Siennas and Tundras got almost-free gasoline. While these businesses are complementary, they're very different operations, and should at least be in separate business units, if not a subsidiary or partnership with an existing fuel supplier. *Electricity of a specific voltage and amperage is now a motor vehicle fuel.
- jonknee 8y ago
  Any source for this? The Supercharger network is no longer free (at all for Model 3, 400 kWh in annual credit for Model S/X), but either way it was and still is a heavily marketed feature of Tesla vehicles so you can't ignore the cost. They need to make money or they will go out of business.

adamkittelson 8y ago

They're really struggling with delivery logistics though. I was scheduled to pick up my Model 3, which will be my 3rd Tesla, this Wednesday. I've been hounding them for my bill of sale because the bank needs it before they'll send a check. I called the local delivery center again this morning and they informed me they gave my car to another customer. They didn't bother to let me know about this or the home office so they could begin looking for another VIN to assign to me. Apparently I was just supposed to show up on Wednesday and find out they didn't have a car for me then. I've also already taken out insurance for the VIN they gave me and provided it to my bank so now I have to redo all that whenever they get around to giving me another VIN and hope they don't give that car away too. My first two delivery experiences were great but now I'm starting to think I'd get a better experience working with a traditional dealership.

ryanhuff 8y ago
I suspect as they fix one issue (production, etc), the next in line becomes the bottleneck. Now it’s delivery logistics, but once that’s fixed, it will become service, which already seems to be straining.
- threeseed 8y ago
  Companies around the world are building, shipping and supporting products simultaneously. Really confused why Tesla can't do the same.
  - Kliment 8y ago
    The way I understand it what the previous poster was saying was that they're building a high-volume pipeline which is likely to have issues as it's new to them, and the delivery issues can't show until there's sufficient volume coming in from manufacturing, and the service problems can't show until there's sufficient volume of vehicles delivered.
  - Latteland 8y ago
    Tesla doubled their production last quarter, and everything else needs to double, and they are having trouble. The reason 'other car companies' can do better is because Ford or Porsche are stabile companies, with a slow change in the number of vehicles over time. They are more organized than tesla for sure, and they know how to change manufacturing lines when a new model comes out, way better than the young pup tesla. But ford doesn't double production every quarter like tesla is doing now; one model might change but overall production, sales, support staff doesn't change. Ford has some amount of slack available, but I doubt they could double production from one quarter to the next and just be okay. At least tesla has shown their delivery was not up to the job. The factory is handling it, but struggling. Anyway, if I got a new car, tesla or now, I'd want it to be well made and for there to be enough salespeople and support and finance and repair staff to handle me - tesla is sucking wind trying to handle all the new customers. At the same time, they are also on full production of new supercharging stations all across the us and the world.

stevespang 8y ago

As the article states: The Koch Brothers During 2015, their network of fossil-fuel CEOs worked together create and fund an advocacy organization with $10 million USD in February of 2016. The organization launched in August of 2016 as: Fueling U.S. Forward. BIG OIL's disinformation campaign to destroy Tesla

jseliger 8y ago

This article is especially interesting in light of "Can We Go Electric Before It’s Too Late?" https://www.citylab.com/transportation/2018/10/where-americas-charge-towards-electric-vehicles-stands-today/572857 https://www.citylab.com/transportation/2018/10/where-america.... The answer may be "no," but Tesla is a big part, and outside of China likely the biggest part, of the answer.

Animats 8y ago
China is aggressively going electric. Shenzhen went with all electric buses last year. Getting a permit for a car in Beijing is far easier for an electric car. China's electric car production is 3x US production.[1] Yes, many of them are small city cars, but then, they're used for getting around big cities. [1] https://qz.com/1303594/when-it-comes-to-making-electric-cars-theres-china-and-everyone-else/ https://qz.com/1303594/when-it-comes-to-making-electric-cars...
- seanmcdirmid 8y ago
  Ya, you’ll see lots of Tesla’s in Beijing these days because of the lottery, even though they cost 2X what they do in the states (rich Chinese don’t want to be seen driving around in a BYD).

dwighttk 8y ago

Article could really use a disclaimer clarifying if the author owns stock in Tesla.

tardo99 8y ago

A company can be doing well and have its stock massively overvalued at the same time.

csours 8y ago

Disclaimer up front: I work for a Tesla competitor, any opinions are solely my own. From the linked article: > "And now NHTSA testing shows that the #1, #2 and #3 cars with the lowest likelihood of injury in a collision are the Tesla Models 3, X and S in that order." https://www.cnet.com/roadshow/news/tesla-model-3-nhtsa-safety-claims/ https://www.cnet.com/roadshow/news/tesla-model-3-nhtsa-safet... https://www.nhtsa.gov/press-releases/national-highway-traffic-safety-administration-issues-statement-about-new-car https://www.nhtsa.gov/press-releases/national-highway-traffi... > "NHTSA does not distinguish safety performance beyond that rating, thus there is no "safest" vehicle among those vehicles achieving 5-star ratings." Perhaps stop making claims that are not backed by the source you claim to use.

1123581321 8y ago
The CNET article you linked says: “Over email, a Tesla spokeswoman did offer more explanation on the probability-of-injury statistic. NHTSA compiles raw injury data in a load of spreadsheets every year, and it computes the overall probability of injury, listing it as a Vehicle Safety Score in its published results. That's where Tesla pulled the data from, and you can check this year's results for yourself on regulations.gov.” It seems that NHTSA is only disputing that they hand out an official “safest vehicle” rating, not that Tesla did that well in their data. I would say that the claim is backed up if going by the actual results and not the capped, publicized rating. I’m curious what you thought when you came across that part of the article.
- dwighttk 8y ago
  Man regulations.gov is a terrible site. The only document I could find that contained "vehicle safety score" was: https://www.regulations.gov/document?D=NHTSA-2015-0119-0001 https://www.regulations.gov/document?D=NHTSA-2015-0119-0001
  - csours 8y ago
    It's linked from the CNET article: https://www.regulations.gov/docket?D=NHTSA-2017-0037 https://www.regulations.gov/docket?D=NHTSA-2017-0037

mapgrep 8y ago

I decided to just look into an assertion from the first paragraph of this post: "NHTSA testing shows that the #1, #2 and #3 cars with the lowest likelihood of injury in a collision are the Tesla Models 3, X and S in that order." This is linked to a news article on "CleanTechnica," sourced to the Tesla corporate blog. Notably, the blog does not claim that these vehicles are #1,2,3 in the rankings, but rather that in prior tests the X and S models were found to have "the lowest and second lowest probabilities of injury of all cars ever tested." But it turns out NHTSA disputes even Tesla's more mild assertions: "A five-star rating is the highest safety rating a vehicle can achieve," the agency said in the statement, which did not name Tesla. "NHTSA does not distinguish safety performance beyond that rating, thus there is no 'safest' vehicle among those vehicles achieving five-star ratings." https://autoweek.com/article/car-news/nhtsa-downplays-teslas-statements-model-3-crash-ratings https://autoweek.com/article/car-news/nhtsa-downplays-teslas... In 2017, just over 30 cars attained 5-star ratings: https://www.safercar.gov/Vehicle-Shoppers/my2017_5_star_tests https://www.safercar.gov/Vehicle-Shoppers/my2017_5_star_test...

kbenson 8y ago
> But it turns out NHTSA disputes even Tesla's more mild assertions: I think it's worth noting that neither are contradicting each other, as they are saying different things. Tesla says NHTSA testing shows something, which may have nothing to do with specifically what the NHTSA says or how it rates. If they have access to the actual test data (or the tests are publicly available), they can make assertions off that data. If that was the case, the NHTSA is clarifying its position, in that it is not making those claims so them saying "NHTSA does not distinguish safety performance beyond that rating, thus there is no 'safest' vehicle among those vehicles achieving five-star ratings." is a way of clarifying their position and staying neutral, since they haven't made that assertion for any other vehicles in the past. In other words, it's possible for them both to be be correct and accurate, but talking about slightly different things. This doesn't even require intent to deceive from either party. I, of course, have no idea if that's true and this is the case. It is one possible way to interpret the statements though, so a little additional investigation might be warranted before we determine that either statement is false or intentionally misleading.

Animats 8y ago

Tesla still isn't doing all that great on production.[1] They've been unable to sustain the 5,000 units a week output for the Model 3 line. They're back down around 4,000. The week to week numbers are all over the place, from 2000 to 6000. Auto plants are usually much more consistent. A Ford exec points out that their F-150 production line at the Rouge produces a truck every 55 seconds. You can take the plant tour in Detroit and see this. Tesla's open-ended tent setup in Fremont isn't going to work once rainy season starts. Their production problems should have been fixed by now, but clearly they're still struggling. And, as Bob Lutz says, they have way too many people in the Fremont plant. Tesla has 10,000 workers in Fremont. Ford's entire Rouge complex has about 5000 workers. Tesla has accomplished a lot, but the core business still isn't running smoothly. [1] https://www.bloomberg.com/graphics/2018-tesla-tracker/ https://www.bloomberg.com/graphics/2018-tesla-tracker/

_ph_ 8y ago
First of all, we don't know whether the production is "all over the place". Your are quoting the weekly numbers from the Bloomberg tracker. But this tracker does not know about actual production numbers. It mostly looks at VIN allocation, which is not directly coupled to production numbers. Typically, Tesla allocates about 30% more VINs than the production numbers. Based on that, Bloomberg came close to the total quarter production number, but it does not give information about the weekly production numbers. We only know the average production number of over 4000 cars/week. Tesla has more workers in their Freemont plant, but they have a very high vertical integration. They are producing their own seats for example.
- Animats 8y ago
  Ford's Rouge plant has a steel mill. Iron ore comes in via barge. They have a glass plant. A power plant. A casting plant. An engine plant. Now that's vertical integration.
  - reissbaker 8y ago
    Ford also sold (far) fewer cars of any model in North America than Tesla did, and is exiting the market minus the Focus Active and the Mustang, retreating to just SUVs and trucks.

danso 8y ago

Besides the problematic assertions this article makes about Tesla's business fundamentals (already addressed in the comments), I just want to call out the absurdity of its media conspiracy theory: > Media outlets are doing what they can to survive. They’re laying off seasoned journalists with strong fact-checking instincts. They’re laying off fact-checkers. They’re laying off editors. They’re rethinking how they write headlines to compete with clickbait...Tesla and Musk are big eyeball grabbers. They have been for five years, as this Google Trends graph shows. One publisher I work with regularly told me, anecdotally, that anything with Tesla or Musk in the headline is likely to perform better than average. Only someone who has his head firmly in the Tesla bubble could imagine that the eyeballs that Tesla/Musk articles attract are any kind of significant blip in the revenues or traffic of a major general news outlet. It's really hard to imagine how clueless this author is, as if he had just woken up from a 2 year nap and doesn't realize what currently dominates the headlines and reader traffic. Take this Sept. 4 article from BuzzFeed News, which arguably directly led to Musk bringing a libel suit upon himself: https://www.buzzfeednews.com/article/ryanmac/elon-musk-thai-cave-rescuer-accusations-buzzfeed-email https://www.buzzfeednews.com/article/ryanmac/elon-musk-thai-... I would bet a decent chunk of money that the reporters who worked on that story get paid more, and put more work into that article than did their colleague for this article from yesterday, "16 Bakers Who Should Be Very, Very Ashamed": https://www.buzzfeed.com/jamiejones/people-who-wont-be-winning-star-baker https://www.buzzfeed.com/jamiejones/people-who-wont-be-winni... The "16 Bakers" article has 326,000+ views, according to Buzzfeed's own metrics. The BuzzFeedNews domain does not display pageview metrics, perhaps partly to look more dignified, but also because BuzzFeed's reported articles generally are nowhere near as popular in pure pageviews as the standard Buzzfeed listicle. Moreover, the Buzzfeed listicles sell ads (the Bakers' listicle has a sponsored Uncle Ben's ad), whereas the BuzzFeedNews articles rarely have any ads. So tell me how paying quality reporters to write damaging articles about Tesla/Musk helps BuzzFeed's bottom line?

appleiigs 8y ago

Fluff article. He could've spent a moment reviewing TSLA's financial statements for facts instead of talking about conspiracies.

thewizardofaus 8y ago

But who would want to buy a car that was made in a tent?