4 ms·

They tend to lower the prices instead of increasing them to not go bankrupt.

Proven 7y ago
Yes but as somebody said earlier they can't make more cars to make use of that
api 7y ago
Tesla won't go bankrupt. They have a very valuable brand and a lot of valuable IP. What could happen if they don't make it is that they get bought by another auto maker or company that wants to enter the space at a price that is much less than what Tesla's shareholders would prefer and the investors take a big haircut.
- CoffeeDregs 7y ago
  That doesn't mean they won't go bankrupt... The brand and IP are assets but the liabilities can easily exceed them. Perhaps you mean that Tesla won't disappear...
- vikramkr 7y ago
  They have a ton of debt and that's what matters, investors can only legally take a haircut down to 0% and debt must be paid down. Another company buying then would be buying the debt as well. If their cash flows aren't enough to pay down the debt and keep operations going, then they will ha e to file bankruptcy, at quick point those other companies you mentioned might buy Tesla's assets.
hyperbovine 7y ago
Why the downvotes? Tesla is objectively a bankruptcy risk. A huge number of professional analysts agree with this statement. You’re better than this, HN.
- bryanlarsen 7y ago
  They just raised $1.5B at relatively reasonable terms. Not great, but not horrible either. So now short-term bankruptcy is off the table, and investors have bet $1.5B against those "professional analysts".
  - toomuchtodo 7y ago
    Fiat Chrysler is also paying Tesla $2 billion over the next 2 years for EV credits in Europe to avoid even higher fines for the inability to sell enough low emissions vehicles. https://www.theverge.com/2019/4/8/18300393/tesla-fiat-chrysler-credits-european-union-emissions-fines https://www.theverge.com/2019/4/8/18300393/tesla-fiat-chrysl...
- leesec 7y ago
  Why is Tesla a bankruptcy risk and Uber is not?
  - hyperbovine 7y ago
    Where did I say that?
  - hef19898 7y ago
    My opinion? Competition with deep pockets and a lot of relevant expertise. Tesla is going against the whole automotive OEM sector and did well dor quite some time. Continuing so requires a lot of cash for a long time which Tesla has trouble generating from operations. Uber on the other hand is going against a fractured market with uncoordinated incumbents that are to large part protected by regulations. That means small competitors who are not used to that kind of competition. Also requires a lot of cash, yet has a clear end game and less market penetration challenges. Both are a gamble, sure, but Tesla is IMHO the riskier bet.
    - tasubotadas 7y ago
      >Competition with deep pockets and a lot of relevant expertise. Tesla is going against the whole automotive OEM sector and did well dor quite some time. The same story was told 5 years ago. I think Tesla proved that it has enough expertise in the industry and the deep pockets do not matter if you can't produce one decent EV model.
    - dominotw 7y ago
      > Uber on the other hand is going against a fractured market with uncoordinated incumbents Isn't uber going against lyft, ola, didi in the short term and going against tsla, waymo long term. Its almost trivial to start your own uber but almost impossible to start your own tesla.
  - danso 7y ago
    Where did you read that Uber is financially stable?
  - johannes1234321 7y ago

Yes but as somebody said earlier they can't make more cars to make use of that

api 7y ago

Tesla won't go bankrupt. They have a very valuable brand and a lot of valuable IP. What could happen if they don't make it is that they get bought by another auto maker or company that wants to enter the space at a price that is much less than what Tesla's shareholders would prefer and the investors take a big haircut.

CoffeeDregs 7y ago
That doesn't mean they won't go bankrupt... The brand and IP are assets but the liabilities can easily exceed them. Perhaps you mean that Tesla won't disappear...
vikramkr 7y ago
They have a ton of debt and that's what matters, investors can only legally take a haircut down to 0% and debt must be paid down. Another company buying then would be buying the debt as well. If their cash flows aren't enough to pay down the debt and keep operations going, then they will ha e to file bankruptcy, at quick point those other companies you mentioned might buy Tesla's assets.

hyperbovine 7y ago

Why the downvotes? Tesla is objectively a bankruptcy risk. A huge number of professional analysts agree with this statement. You’re better than this, HN.

bryanlarsen 7y ago
They just raised $1.5B at relatively reasonable terms. Not great, but not horrible either. So now short-term bankruptcy is off the table, and investors have bet $1.5B against those "professional analysts".
- toomuchtodo 7y ago
  Fiat Chrysler is also paying Tesla $2 billion over the next 2 years for EV credits in Europe to avoid even higher fines for the inability to sell enough low emissions vehicles. https://www.theverge.com/2019/4/8/18300393/tesla-fiat-chrysler-credits-european-union-emissions-fines https://www.theverge.com/2019/4/8/18300393/tesla-fiat-chrysl...
leesec 7y ago
Why is Tesla a bankruptcy risk and Uber is not?
- hyperbovine 7y ago
  Where did I say that?
- hef19898 7y ago
  My opinion? Competition with deep pockets and a lot of relevant expertise. Tesla is going against the whole automotive OEM sector and did well dor quite some time. Continuing so requires a lot of cash for a long time which Tesla has trouble generating from operations. Uber on the other hand is going against a fractured market with uncoordinated incumbents that are to large part protected by regulations. That means small competitors who are not used to that kind of competition. Also requires a lot of cash, yet has a clear end game and less market penetration challenges. Both are a gamble, sure, but Tesla is IMHO the riskier bet.
  - tasubotadas 7y ago
    >Competition with deep pockets and a lot of relevant expertise. Tesla is going against the whole automotive OEM sector and did well dor quite some time. The same story was told 5 years ago. I think Tesla proved that it has enough expertise in the industry and the deep pockets do not matter if you can't produce one decent EV model.
  - dominotw 7y ago
    > Uber on the other hand is going against a fractured market with uncoordinated incumbents Isn't uber going against lyft, ola, didi in the short term and going against tsla, waymo long term. Its almost trivial to start your own uber but almost impossible to start your own tesla.
- danso 7y ago
  Where did you read that Uber is financially stable?
- johannes1234321 7y ago