7 ms·

No surprise, Elon seems to be cutting to the bone right now. Maybe to juice the stock price? But it does not seem like Tesla is investing in the future right

No surprise, Elon seems to be cutting to the bone right now. Maybe to juice the stock price? But it does not seem like Tesla is investing in the future right now. On the contrary, I feel like their future looks a little bleak after the most recent cuts.

chasd00 2y ago
Also, I get the feeling Elon's trip to China and the deal he made was out of desperation. Watch for self-driving technology, that's bug for bug identical to Tesla's, to start showing up in the Chinese EVs.
- toomuchtodo 2y ago
  Tesla is in a valuation trap. Elon can only continue operating as he has if Tesla is valued as “not a car company.” AI, robotaxi, whatever. They are running out of runway from a valuation perspective, although Tesla would be fine going through Chapter 11 if needed. Would continue as a going concern and not be parted out imho. But Elon’s wings would melt and he’d fall back to Earth.
  - vizzier 2y ago
    The craziest part to me of this idea of their valuation is being a tech company not a car is that the stock jumped 20% on ... news that they're going to release an affordable car? None of it makes any sense.
    - toomuchtodo 2y ago
      Jumped on the China data sharing deal with Baidu for FSD. https://www.reuters.com/technology/baidu-tesla-agree-mapping-deal-fsd-china-sources-say-2024-04-29/ https://www.reuters.com/technology/baidu-tesla-agree-mapping...
      - Workaccount2 2y ago
        Which is insane, because the market priced that news as being a ~$100 billion in value. The people trading Tesla are so far removed from reality its scary.
  - chefkd 2y ago
    Do you really think Tesla is going bankrupt? 90 billion in revenue, 10 billion in profit seems healthy? In terms of market share Tesla sold more than Chevrolet, Ford and Volkswagen combined. Granted idk much about valuations just curious what people look at is it something to do with the stock price itself?
    - supportengineer 2y ago
      They won't sustain 90 billion in revenue going forward, based on Elon's antics, including the recent mass layoffs.
      - deleted 2y ago
        [deleted]
    - nwiswell 2y ago
      Right, it's just the stock price. The health of the underlying company is a different matter. From a corporate financials perspective, Tesla is a very healthy company: low debt, high profit. Their stock does seem to be at risk of dramatic re-pricing, and that can have knock-on effects in the long run (harder to use stock as compensation, high performers with unvested grants may leave, etc). But certainly bankruptcy does not seem to be in the cards.
    - toomuchtodo 2y ago
      Anything is possible when an enterprise is being operated in a careless fashion. I would like to think someone would stop the bleeding before it got to that, but who knows! I think Tesla will be fine was my point, but Elon's Tesla wealth and control is in peril. (disclosure: early TSLA investor, no current exposure because I like to sleep at night now)
      - chefkd 2y ago
        That's so cool if it isn't weird to ask are there any current early stage companies you think have the potential to become like Tesla? Asking for a friend :)
  - nickfromseattle 2y ago
    Did he leverage any of his Tesla stock to buy Twitter?
    - pclmulqdq 2y ago
      Yes. And his Tesla stock was reportedly very heavily leveraged already, which made the banks a bit hesitant.
- Theodores 2y ago
  I don't feel that Europe or the USA is where any growth can come from, aside for Cybertruck, which is North America only. Anyone middle class would have had one by now and poor people are not customers. In China they are getting crowded out by brands that better understand the local market, for example rear leg room at the cost of vehicle length/handling. They also have lots of self driving solutions that have no chance of making it to the West any time soon. Chinese people also like Chinese brands. American does not mean better. The honeymoon for Western brands is over. With PCs, why would a sensible Chinese person buy some HP or Dell thing when Huawei have that extra touch of quality to them at a better price? Tesla along with GM's Buick, VW and the others making e-cars have this problem.
  - m463 2y ago
    I don't feel that Europe or the USA is where any growth can come from https://en.wikipedia.org/wiki/History_of_Tesla,_Inc.#Timeline_of_production_and_sales https://en.wikipedia.org/wiki/History_of_Tesla,_Inc.#Timelin... I think they're growing just fine. looking at the quarterly breakdown, sales stall every so often, but pick up later. Sort of like California real estate prices. People always say it can't go on, but it does.
- jamesy0ung 2y ago
  He was actually booked to go to India to announce a new factory, but he cancelled it at last minute to go to China [1]. [1] https://m.economictimes.com/industry/renewables/why-elon-musk-chose-to-go-to-china-rather-than-visit-india/amp_articleshow/109715183.cms https://m.economictimes.com/industry/renewables/why-elon-mus...
mensetmanusman 2y ago
You’re not surprised that the high pressure materials limitations were discovered at these particular pressures?
throwaway5959 2y ago
His $55 billion pay package would pay $100k per year for the 14k employees he just laid off for the next 40 years. I’m surprised the stock is still north of $100.
- pclmulqdq 2y ago
  They have produced about 5 million cars total, so his desired pay package is $10,000 per car.
- Workaccount2 2y ago
  Public CEO compensation is financed by shareholders, not by the company. His Tesla salary is likely zero. You would need to convince the shareholders to give stock compensation to the employees and convince the employees to be paid in stock instead of dollars.
  - pclmulqdq 2y ago
    This is not correct, although there is a distinction between cash compensation and shares/options. While the money doesn't come out of Tesla's bank account, stock-based compensation goes down on the balance sheet as a loss, exactly as if it were cash. Startup people are primed to think that cash accounting is what's actually important for a company in terms of doing things, going bankrupt, etc. It largely is for startups. For large companies, however, it's actually the opposite: cash accounting is a sort of boring task left to the accounting department, whose job is usually to keep a minimum amount of cash lying around, and your balance sheets and income statements are actually what determines your access to business opportunities.
    - Workaccount2 2y ago
      >While the money doesn't come out of Tesla's bank account So whats your point? Because regular employee pay sure as shit does. You said it's incorrect, and then in the next sentence stated how it is correct. Yes, Tesla has shares on it's balance sheet. Yes, giving out those shares is a loss in assets. But doing mark-to-market and calling it cash is a bit of woo-woo because no, shares are not cash and they don't become cash until shareholders hand over that cash. Here is a thought experiment: Tomorrow investors just decide to stop buying Tesla stock, and the price goes to zero. Mass brain control or something. The share price just sits at zero. No buy orders anywhere. The company still sells cars. They still have cash coming in. They still can pay suppliers and pay employees. There is profit and everything. The people paid with shares though are screwed. Their compensation is zero. Why is it zero? Because shareholders aren't giving their cash for shares.

chasd00 2y ago

Also, I get the feeling Elon's trip to China and the deal he made was out of desperation. Watch for self-driving technology, that's bug for bug identical to Tesla's, to start showing up in the Chinese EVs.

toomuchtodo 2y ago
Tesla is in a valuation trap. Elon can only continue operating as he has if Tesla is valued as “not a car company.” AI, robotaxi, whatever. They are running out of runway from a valuation perspective, although Tesla would be fine going through Chapter 11 if needed. Would continue as a going concern and not be parted out imho. But Elon’s wings would melt and he’d fall back to Earth.
- vizzier 2y ago
  The craziest part to me of this idea of their valuation is being a tech company not a car is that the stock jumped 20% on ... news that they're going to release an affordable car? None of it makes any sense.
  - toomuchtodo 2y ago
    Jumped on the China data sharing deal with Baidu for FSD. https://www.reuters.com/technology/baidu-tesla-agree-mapping-deal-fsd-china-sources-say-2024-04-29/ https://www.reuters.com/technology/baidu-tesla-agree-mapping...
    - Workaccount2 2y ago
      Which is insane, because the market priced that news as being a ~$100 billion in value. The people trading Tesla are so far removed from reality its scary.
- chefkd 2y ago
  Do you really think Tesla is going bankrupt? 90 billion in revenue, 10 billion in profit seems healthy? In terms of market share Tesla sold more than Chevrolet, Ford and Volkswagen combined. Granted idk much about valuations just curious what people look at is it something to do with the stock price itself?
  - supportengineer 2y ago
    They won't sustain 90 billion in revenue going forward, based on Elon's antics, including the recent mass layoffs.
    - deleted 2y ago
      [deleted]
  - nwiswell 2y ago
    Right, it's just the stock price. The health of the underlying company is a different matter. From a corporate financials perspective, Tesla is a very healthy company: low debt, high profit. Their stock does seem to be at risk of dramatic re-pricing, and that can have knock-on effects in the long run (harder to use stock as compensation, high performers with unvested grants may leave, etc). But certainly bankruptcy does not seem to be in the cards.
  - toomuchtodo 2y ago
    Anything is possible when an enterprise is being operated in a careless fashion. I would like to think someone would stop the bleeding before it got to that, but who knows! I think Tesla will be fine was my point, but Elon's Tesla wealth and control is in peril. (disclosure: early TSLA investor, no current exposure because I like to sleep at night now)
    - chefkd 2y ago
      That's so cool if it isn't weird to ask are there any current early stage companies you think have the potential to become like Tesla? Asking for a friend :)
- nickfromseattle 2y ago
  Did he leverage any of his Tesla stock to buy Twitter?
  - pclmulqdq 2y ago
    Yes. And his Tesla stock was reportedly very heavily leveraged already, which made the banks a bit hesitant.
Theodores 2y ago
I don't feel that Europe or the USA is where any growth can come from, aside for Cybertruck, which is North America only. Anyone middle class would have had one by now and poor people are not customers. In China they are getting crowded out by brands that better understand the local market, for example rear leg room at the cost of vehicle length/handling. They also have lots of self driving solutions that have no chance of making it to the West any time soon. Chinese people also like Chinese brands. American does not mean better. The honeymoon for Western brands is over. With PCs, why would a sensible Chinese person buy some HP or Dell thing when Huawei have that extra touch of quality to them at a better price? Tesla along with GM's Buick, VW and the others making e-cars have this problem.
- m463 2y ago
  I don't feel that Europe or the USA is where any growth can come from https://en.wikipedia.org/wiki/History_of_Tesla,_Inc.#Timeline_of_production_and_sales https://en.wikipedia.org/wiki/History_of_Tesla,_Inc.#Timelin... I think they're growing just fine. looking at the quarterly breakdown, sales stall every so often, but pick up later. Sort of like California real estate prices. People always say it can't go on, but it does.
jamesy0ung 2y ago
He was actually booked to go to India to announce a new factory, but he cancelled it at last minute to go to China [1]. [1] https://m.economictimes.com/industry/renewables/why-elon-musk-chose-to-go-to-china-rather-than-visit-india/amp_articleshow/109715183.cms https://m.economictimes.com/industry/renewables/why-elon-mus...

mensetmanusman 2y ago

You’re not surprised that the high pressure materials limitations were discovered at these particular pressures?

throwaway5959 2y ago

His $55 billion pay package would pay $100k per year for the 14k employees he just laid off for the next 40 years. I’m surprised the stock is still north of $100.

pclmulqdq 2y ago
They have produced about 5 million cars total, so his desired pay package is $10,000 per car.
Workaccount2 2y ago
Public CEO compensation is financed by shareholders, not by the company. His Tesla salary is likely zero. You would need to convince the shareholders to give stock compensation to the employees and convince the employees to be paid in stock instead of dollars.
- pclmulqdq 2y ago
  This is not correct, although there is a distinction between cash compensation and shares/options. While the money doesn't come out of Tesla's bank account, stock-based compensation goes down on the balance sheet as a loss, exactly as if it were cash. Startup people are primed to think that cash accounting is what's actually important for a company in terms of doing things, going bankrupt, etc. It largely is for startups. For large companies, however, it's actually the opposite: cash accounting is a sort of boring task left to the accounting department, whose job is usually to keep a minimum amount of cash lying around, and your balance sheets and income statements are actually what determines your access to business opportunities.
  - Workaccount2 2y ago
    >While the money doesn't come out of Tesla's bank account So whats your point? Because regular employee pay sure as shit does. You said it's incorrect, and then in the next sentence stated how it is correct. Yes, Tesla has shares on it's balance sheet. Yes, giving out those shares is a loss in assets. But doing mark-to-market and calling it cash is a bit of woo-woo because no, shares are not cash and they don't become cash until shareholders hand over that cash. Here is a thought experiment: Tomorrow investors just decide to stop buying Tesla stock, and the price goes to zero. Mass brain control or something. The share price just sits at zero. No buy orders anywhere. The company still sells cars. They still have cash coming in. They still can pay suppliers and pay employees. There is profit and everything. The people paid with shares though are screwed. Their compensation is zero. Why is it zero? Because shareholders aren't giving their cash for shares.