Is Tesla just months away from a total collapse?
Thread Starter
Lexus Fanatic
Joined: Oct 2003
Posts: 94,542
Likes: 264
From: Virginia/D.C. suburbs
I think, though, that the pundits are correct in that it will probably live on as a battery or electronics firm rather than as a genuine auto-maker.
Lexus Champion
Joined: Feb 2011
Posts: 3,309
Likes: 31
From: Canada
Talk of Tesla really burning up cash has been around since last fall.
From November 2017...
Source
From February 2018...
Source
From November 2017...
Tesla’s Burning Through Nearly Half a Million Dollars Every Hour
- By this calculation, Tesla would exhaust cash on Aug. 6
- Company says it has ample money to meet its production targets
...Over the past 12 months, the electric-car maker has been burning money at a clip of about $8,000 a minute (or $480,000 an hour), Bloomberg data show. At this pace, the company is on track to exhaust its current cash pile on Monday, Aug. 6. (At 2:17 a.m. New York time, if you really want to be precise.)
- By this calculation, Tesla would exhaust cash on Aug. 6
- Company says it has ample money to meet its production targets
...Over the past 12 months, the electric-car maker has been burning money at a clip of about $8,000 a minute (or $480,000 an hour), Bloomberg data show. At this pace, the company is on track to exhaust its current cash pile on Monday, Aug. 6. (At 2:17 a.m. New York time, if you really want to be precise.)
From February 2018...
1. How many Model 3s can Tesla actually produce?
The more affordable Model 3 sedan is the linchpin of Tesla’s attempt to transition from niche automaker to high-volume manufacturer, and the ramp-up so far has been muted. The first wave of cars has been delivered to paying customers, but Tesla has delayed targets several times to focus on quality and play whack-a-mole with several unspecified production bottlenecks at both its Gigafactory in Nevada and its assembly plant in California.
Tesla said in January that it expects a more gradual production ramp through the first quarter and intends to achieve the 5,000-per-week milestone by late June, three months later than previous guidance–and even that was already delayed a quarter. The company hasn’t yet clarified whether a 10,000-per-week run rate is still possible this year. When that question came up back in November, Musk answered with a 12-second pause.
The more affordable Model 3 sedan is the linchpin of Tesla’s attempt to transition from niche automaker to high-volume manufacturer, and the ramp-up so far has been muted. The first wave of cars has been delivered to paying customers, but Tesla has delayed targets several times to focus on quality and play whack-a-mole with several unspecified production bottlenecks at both its Gigafactory in Nevada and its assembly plant in California.
Tesla said in January that it expects a more gradual production ramp through the first quarter and intends to achieve the 5,000-per-week milestone by late June, three months later than previous guidance–and even that was already delayed a quarter. The company hasn’t yet clarified whether a 10,000-per-week run rate is still possible this year. When that question came up back in November, Musk answered with a 12-second pause.
2. How far off are the long-awaited updates to Tesla’s autonomous features?
Musk vowed to demonstrate a completely autonomous Los Angeles-to-New York trip by the end of 2017–a feat that hasn’t yet happened. Investors and enthusiasts alike know that the chief executive officer’s timelines are often overly aggressive. But with autonomous driving now as hot as electrification–General Motors Co. vehicles are improving fast, and Alphabet Inc.’s Waymo plans to start ferrying passengers in Phoenix this year–there will be renewed focus on Tesla’s driverless program.
Things have not been smooth within the Autopilot team at Tesla. Two leaders departed in roughly the past year, and staff has suffered from inevitable talent churn. It doesn’t help that Chris Lattner, who led the team from January 2017 until June, recently got his Model 3 and threw some shade via Twitter about lack of progress on Autopilot. Tesla also recently disclosed that it didn’t test any autonomous cars on California’s public roads last year, even as Waymo churned up more than 352,000 miles.
Musk vowed to demonstrate a completely autonomous Los Angeles-to-New York trip by the end of 2017–a feat that hasn’t yet happened. Investors and enthusiasts alike know that the chief executive officer’s timelines are often overly aggressive. But with autonomous driving now as hot as electrification–General Motors Co. vehicles are improving fast, and Alphabet Inc.’s Waymo plans to start ferrying passengers in Phoenix this year–there will be renewed focus on Tesla’s driverless program.
Things have not been smooth within the Autopilot team at Tesla. Two leaders departed in roughly the past year, and staff has suffered from inevitable talent churn. It doesn’t help that Chris Lattner, who led the team from January 2017 until June, recently got his Model 3 and threw some shade via Twitter about lack of progress on Autopilot. Tesla also recently disclosed that it didn’t test any autonomous cars on California’s public roads last year, even as Waymo churned up more than 352,000 miles.
3. Have customer deposits become a major revenue stream?
In an unusual way for automakers to raise cash, Tesla takes deposits from customers for products that have been unveiled but are not yet in production. That amounted to a staggering $686 million on the books at the end of the third quarter, much of that from down payments for the Model 3 sedan. And in November, Tesla unveiled not just one but two new vehicles: an electric Semi truck and a next-generation Roadster sports car.
Deposits for the Semi and the Roadster could add a further $300 million to Tesla’s working capital, according to UBS analyst Colin Langan, and clearing inventory could add $400 million. With reservations for the “Founders” series Roadster running at $250,000 each, could this be the moment when deposits approach $1 billion?
In an unusual way for automakers to raise cash, Tesla takes deposits from customers for products that have been unveiled but are not yet in production. That amounted to a staggering $686 million on the books at the end of the third quarter, much of that from down payments for the Model 3 sedan. And in November, Tesla unveiled not just one but two new vehicles: an electric Semi truck and a next-generation Roadster sports car.
Deposits for the Semi and the Roadster could add a further $300 million to Tesla’s working capital, according to UBS analyst Colin Langan, and clearing inventory could add $400 million. With reservations for the “Founders” series Roadster running at $250,000 each, could this be the moment when deposits approach $1 billion?
4. Is Tesla making any progress on getting into China?
5. How fast is all that cash burning?
Tesla was burning through $8,000 a minute last year, according to Bloomberg calculations, and the slower ramp-up of the Model 3 means there’s less cash coming in the door. But the company has always been creative about financing and just sold $546 million of auto lease-backed bonds. The question looming large for Wall Street: Just how long can Tesla go before it returns to the equity or debt markets? Most analysts expect a $2 billion to $3 billion capital raise sometime this year, though the forecast as to timing is still up in the air.
Tesla was burning through $8,000 a minute last year, according to Bloomberg calculations, and the slower ramp-up of the Model 3 means there’s less cash coming in the door. But the company has always been creative about financing and just sold $546 million of auto lease-backed bonds. The question looming large for Wall Street: Just how long can Tesla go before it returns to the equity or debt markets? Most analysts expect a $2 billion to $3 billion capital raise sometime this year, though the forecast as to timing is still up in the air.
Lexus Champion
Joined: Mar 2014
Posts: 2,053
Likes: 116
From: CA
Tesla's survival may come down to how much personal money musk is willing to pump into it (if fund raising fails). Whether they survive or not, they are certainly facing a formidable test - an upstart auto maker, bad PR of late, missed manufacturing projections and possible money / credit issues - time will tell.
On a side note, honestly, I've never quite embraced the great enthusiasm behind electric cars to this point. Until we achieve a greater percentage of our electricity being generated by renewable sources, it would seem electric cars simply trade gasoline pollution for electricity generating pollution.
On a side note, honestly, I've never quite embraced the great enthusiasm behind electric cars to this point. Until we achieve a greater percentage of our electricity being generated by renewable sources, it would seem electric cars simply trade gasoline pollution for electricity generating pollution.
CL Community Team
Joined: Aug 2006
Posts: 12,562
Likes: 230
From: San Francisco, CA
Agreed that E cars dont really make sense unless we get energy from more renewable energy. But we have to start somewhere and we cant just sit around waiting for something to happen or be in optimal conditions. At least we live in CA where we are a leader in renewable energy sources.
ClubLexus Stories
Celebrating Lexus & Toyota from Around the Globe
Top 10 Most Confusing Things Lexus Has Ever Done!
Joe Kucinski
2026 Lexus ES Review: Lexus Re-Embraces Founding Principles
Michael S. Palmer
10 Lexus Bargains That are Cheaper Than a New Toyota RAV4
Joe Kucinski
8 Weirdest Things Lexus Has Ever Built
Verdad Gallardo
10 Lexus Designs That Have Aged Like Fine Wine
Verdad Gallardo
8 Tips for Improving Your Hybrid or Plug-in Hybrid's Efficiency!
Michael S. Palmer
10 Best Lexus Models No One Remembers
Joe Kucinski
TRD Off-Road Premium: Best 2026 4Runner, Except This One Thing
Michael S. Palmer
Top 10 Lexus & Toyotas to Drive Before You Die!
Joe Kucinski
Lexus Champion
Joined: Mar 2014
Posts: 2,053
Likes: 116
From: CA
Agreed, we have to start somewhere (and I'm glad we have, cleaner planet FTW!).
Not to steer this thread OT, but it's hard for me to imagine existing renewable sources ever supporting 288 million electric cars on the road, as there were registered vehicles in 2016 - and what 288 million+ electric vehicles would look like if we can't figure out another source of electricity (short of figuring out cold fusion).
Not to steer this thread OT, but it's hard for me to imagine existing renewable sources ever supporting 288 million electric cars on the road, as there were registered vehicles in 2016 - and what 288 million+ electric vehicles would look like if we can't figure out another source of electricity (short of figuring out cold fusion).
Lexus Test Driver
Joined: Feb 2002
Posts: 8,224
Likes: 256
From: New York
Tesla still has value in its charging network, battery manufacturing, technology and unique design/features etc.
Electric cars will only increase in sales and Tesla still offers the best EVs you can buy.
Plus the brand name is still solid and has a very loyal base.
Q1 sales report on Model3 needs to be strong and stock will go back up.
Electric cars will only increase in sales and Tesla still offers the best EVs you can buy.
Plus the brand name is still solid and has a very loyal base.
Q1 sales report on Model3 needs to be strong and stock will go back up.
CL Community Team
Joined: Aug 2006
Posts: 12,562
Likes: 230
From: San Francisco, CA
Agreed, we have to start somewhere (and I'm glad we have, cleaner planet FTW!).
Not to steer this thread OT, but it's hard for me to imagine existing renewable sources ever supporting 288 million electric cars on the road, as there were registered vehicles in 2016 - and what 288 million+ electric vehicles would look like if we can't figure out another source of electricity (short of figuring out cold fusion).
Not to steer this thread OT, but it's hard for me to imagine existing renewable sources ever supporting 288 million electric cars on the road, as there were registered vehicles in 2016 - and what 288 million+ electric vehicles would look like if we can't figure out another source of electricity (short of figuring out cold fusion).
Lead Lap
Joined: Jul 2010
Posts: 3,946
Likes: 310
From: NY
He's just buying existing shares. The company wont get a single penny out of it. Although the value of the shares he just bought may get hurt if Tesla decides to issue a couple of billion new shares. But this being a cult stock, it will skyrocket to $1m per share in no time.
Lead Lap
Joined: Jul 2010
Posts: 3,946
Likes: 310
From: NY
I feel like electric vehicles are one of those things that nobody asked for. The amount of pollution from the manufacturing of batteries and electric generation will more than offset the benefits of electrification. Plus, the stress of remembering to plug in the damn car every night or road trip ruined.
Lexus Champion
Joined: Mar 2014
Posts: 2,053
Likes: 116
From: CA
"