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Tesla Motors is Circling The Drain
- Thread starter Glenn Holland
- Start date
The -0.94% is after hours trading. Closed today at -2.57%.
Weekend rumors have Musk going off the rails looking for funding. Unconfirmed. TSLA board has issued statements distancing them from his 'funding secured' tweet so.. looks like no one else in management knew about the tweets - or don't want to be on the hook. SEC investigation launched and at least 2 class-action lawsuits filed. Speculation rampant including that they started this furor to distract from Q3 being another money losing quarter despite guidance of profitability. T Rowe Price and Fidelity cut their positions 20% in Q2.
I would really like Tesla to succeed but this is unreal.
Ding! Gotta go, popcorn's ready.
Weekend rumors have Musk going off the rails looking for funding. Unconfirmed. TSLA board has issued statements distancing them from his 'funding secured' tweet so.. looks like no one else in management knew about the tweets - or don't want to be on the hook. SEC investigation launched and at least 2 class-action lawsuits filed. Speculation rampant including that they started this furor to distract from Q3 being another money losing quarter despite guidance of profitability. T Rowe Price and Fidelity cut their positions 20% in Q2.
I would really like Tesla to succeed but this is unreal.
Ding! Gotta go, popcorn's ready.
Others are starting to wonder about Elon’s mental state.
https://www.msn.com/en-us/money/com...-state/ar-BBLYV8b?li=BBnb7Kz&ocid=mailsignout
https://www.msn.com/en-us/money/com...-state/ar-BBLYV8b?li=BBnb7Kz&ocid=mailsignout
I respect Mr Musk ... but I don't envy him ... he must be under an unbearable (for an ordinary mortal being) amount of stress at this moment
I don;t question Musk's "mental state" and I don't like throwing around the terms "mental illness" either.
However, my concern is that Musk is just another politically connected corporate welfare pig and Tesla is a hyper expensive start up that's not going anywhere and investors have got a really bad case of ants in their pants.
In fact, the entire economy of the San Francisco Bay Area is riddled with 100s of these money pits that are waiting to go belly up.
https://www.nytimes.com/2018/08/16/business/elon-musk-interview-tesla.html
The graveyards are full of indispensable men.
The guy needs to get some real sleep and maybe take a few weeks off to reset.
The graveyards are full of indispensable men.
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I don't know why you wouldn't factor in the effects of long-term stress on someone's mental state but if 'corporate welfare pig' does it for you, have at it. But do check out Musk's interview in today's New York Times (linked above by @nsaspook while I was typing - thanks!) Those of us who have done the entrepreneur thing or know some corporate histories can relate. When starting up, lots of things get done by sheer force-of-will but the personality traits that make a good entrepreneur frequently don't always match well with those required to run a large organization. Musk won't admit that and that's why he sleeps on the factory floor and turns wrenches on GL4 instead of assembling his engineering managers at a whiteboard to work out problems.
It's not a big secret that many of Tesla's problems are rooted in Musk himself (as are the successes). He needs to go but the company is so closely identified with him that removing him would be catastrophic. Without Musk, Tesla is just a niche car company that loses money and it's over instantly. IMO, the best thing that could happen for Tesla (and they may be forced to do it) is to kick him upstairs and make him Director of Awesomeness or something. Preserve his status as a unique visionary while letting real managers (and real auto engineers!) get control over the operation. If they don't, it won't be tweets, SEC investigations, lawsuits from short-sellers that kill Tesla. It will be that time-honored chestnut that a business eventually has to deliver product and turn a profit to stay in existence - 3Q not looking too good so far.
All of that may or may not be important to you but you should at least consider that at 9000, Tesla is the largest manufacturing employer in the Bay Area. That's 3X the next one. That's a lot of SFBA people not on welfare and paying their taxes just like you. For better or worse, Tesla employs around 40,000 people in the US, many semi-skilled and in the trades, and going under would not be a good thing for them or the country. But if it makes you feel better, the stock opened down ~6% today.
As for the other money pits, the simple solution, I think, is don't invest in them.
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I just got my electric bill from Pacific Gas & Electric (PG&E) and there's one of those little slips (printed in small light grey type) that says the company is asking the California Public Utilities Commission (PUC) to approve about $12 Million in rate increases to fund electric vehicle charging stations all around Northern California.
I suspect Southern California Edison is also asking for rate increases to install chargers in the L.A. and San Diego area and it's a sure bet that electric utilities all across the country are doing the same thing. Bottom line: The whole electric car industry is getting all sorts of subsidies to provide an artificial market for a product that cannot support itself in the free market. I've also heard that new buildings will be required to install chargers and this is going to be a huge burden on everyone.In fact, I see charging stations is parking lots all around San Francisco and 'm quite certain that none of them are being used.
The is an Office of Ratepayer Advocate (ORA) where you can voice your opinion on these habitual rate increases and the site is www.Ora.Ca.Gov and I'm sure other states have a similar agency to file a protest.
I suspect Southern California Edison is also asking for rate increases to install chargers in the L.A. and San Diego area and it's a sure bet that electric utilities all across the country are doing the same thing. Bottom line: The whole electric car industry is getting all sorts of subsidies to provide an artificial market for a product that cannot support itself in the free market. I've also heard that new buildings will be required to install chargers and this is going to be a huge burden on everyone.In fact, I see charging stations is parking lots all around San Francisco and 'm quite certain that none of them are being used.
The is an Office of Ratepayer Advocate (ORA) where you can voice your opinion on these habitual rate increases and the site is www.Ora.Ca.Gov and I'm sure other states have a similar agency to file a protest.
Well, its 28 cents/month according to
https://www.mercurynews.com/2017/01/20/pge-electric-vehicle-plan-will-increase-customer-bills/
but Glenn, I actually do understand your frustrations. I don't know if BEVs are going to do much, either, and why should the nonBEV folks pay for that? Agreed.
Look, I was born and raised (mostly) in the Bay Area and still have friends, family and business interests there. Most of the fams and friends feel much the same as you do. My brother in law announced he's closing a business and moving to Idaho next year. He lives in a lovely neighborhood on the peninsula and doesn't need to lock his doors when he leaves the house. Last year he made $120K part time but complains bitterly that he has to drive out of the BA to buy the high VOC paints that he wants to use. It's relative and yeah, those continual little bites from things like you describe, unresponsive representatives, eyebrow-raising tolerance of freeloaders and worse as well as a constant diet of TV news get him down on everything. My own brother feels pretty much the same way (despite the fact that most of his problems are self-inflicted). I'm not saying any of this applies to you but something to think about.
Some things are working and the BA is still a nice place to be. I did a lot of corporate flying back in the late 70's there and the BA pollution combined with summer temperature inversions made most arrivals IFR when above 3000' or so, you could see all the way to the Sierras - but <3miles visbility below that meant filing for the approach. That's not a problem any more on most days. Hate on things like CARB as much as you want but you're breathing way cleaner air. 2 weeks ago I flew commercial into SFO and we had delays out of LAX due to low-viz in the BA but it was because of the fires. On most other days, the air is much improved, even with a much larger population and the same seasonal inversion layer. So yeah, it ain't the same but it could be a lot worse.
Enjoy it. Take a stroll down Geary St. Hob-nob and drink free wine waiting for a table at the Pacific Cafe. Hang out with the gliders at Fort Funston. Cruise Land's End. Get a pastrami on rye at Molinari's on Columbus, hop across the GGB and veg in the Marin highlands then drop down the hill and get a couple of pops down at Scoma's in Sausalito. I don't know where you live in the BA but it's all close, the air is soft and clean. Consider that lots of people from lots of places save and scrimp just to get a week's vacation there. Yes again, it ain't the same but no place is, even Idaho. I truly hope you can find a way to put aside the BS and enjoy the good stuff that is still there.
But back to Tesla.
Down today almost $30 (8.93%) in heavy trading to $305.50 with post market down again another $2.00. Pundits blame his flaky image in the NYT interview. Questions about his ability to stay on managing the company. But I think that little articles from researchers that screen credit card transactions and found that demand for the Model 3 is waning except for a few bursts when new versions like 'Performance' or AWD are made available. It doesn't look like they're going to sell anywhere near that 400-500K that the 'reservations' in 2016 suggested. It's gone from wait 1-2 years due to demand to order now, get it in a couple of weeks, maybe sooner - at least for the original version. The lots in Lathrop and Burbank have acres of cars stored. The question that many are asking is 'why are they there?' Tesla says those are just staging lots for delivery. But some are asking that with all of those 'confirmed' orders, why stop in Lathrop? Why not just load the cars onto trucks going to the delivery points and get them to those cash customers? Opinions vary from slack demand to cars built in that arbitrary 5000/mo. rate that they wanted to hit last quarter that are defective or incomplete to lots of opinions in between. Who knows but looking around fan sites like Tesla Motors Club. Pretty hard-core fans there but starting to get frustrated with multiple cancellations of their deliveries and, to put it succinctly, some really bad quality issues. Most are eventually happy when the get the car back from the body shop or whatever but you have to wonder what all of that rework costs TSLA.
While you're there, check out the 'Investor Relations' threads. Whew! Those guys are BELIEVERS. In Tesla, the electric revolution but mostly in Musk. And they put their money where Musk's mouth is - lately to big losses. But it's the shorts, the anti-TSLA media, lying NY times and the people that 'just don't get it' that are the blame. Only now, as some that bought heavily after the '420' tweet are realizing (lawsuits coming..) as they consider their heavy losses are they rethinking things. But a few of the faithful are doubling down and going long. Gotta admire their tenacity if not their financial acumen.
Point of reference: One of my kid's college roomies got his EE, parlayed his analytical skills into a very $ucce$$ful stint as an energy trader then turned down deep into 6 figures to go off on another venture. At a decent Tex-Mex joint here, I asked him what he thought of Tesla. He looked at me, held thumb to middle finger in an 'O' and said 'Going to zero'. Hard to say if he's right and I hope he's wrong for my stated reasons - but I wouldn't bet against him.
My prediction- Elon gets kicked upstairs. Tesla realizes it really is a car manufacturing company and not a tech company selling 15" tablets in a $50K box that you drive home. Responding to demands from institutional shareholders, they clean up the board of directors and install some real managers. It's too little too late and they go chapter 11. That discharges billions in debt and maybe restructures some tax incentive stuff in GF1 and 2. Ordinary bondholders and shareholders get wiped out. New Tesla arises from the ashes to make a credible run at BEV, energy storage and solar. They may even reset the Federal Income Tax Credit incentives which ran out at 200K delivered in Q3. With their tech and supercharger network acquired at pennies on the dollar they may have a a shot.
You heard it here first, folks.
But seriously, pastrami at Molinari's .. to die for.
'nite
https://www.mercurynews.com/2017/01/20/pge-electric-vehicle-plan-will-increase-customer-bills/
but Glenn, I actually do understand your frustrations. I don't know if BEVs are going to do much, either, and why should the nonBEV folks pay for that? Agreed.
Look, I was born and raised (mostly) in the Bay Area and still have friends, family and business interests there. Most of the fams and friends feel much the same as you do. My brother in law announced he's closing a business and moving to Idaho next year. He lives in a lovely neighborhood on the peninsula and doesn't need to lock his doors when he leaves the house. Last year he made $120K part time but complains bitterly that he has to drive out of the BA to buy the high VOC paints that he wants to use. It's relative and yeah, those continual little bites from things like you describe, unresponsive representatives, eyebrow-raising tolerance of freeloaders and worse as well as a constant diet of TV news get him down on everything. My own brother feels pretty much the same way (despite the fact that most of his problems are self-inflicted). I'm not saying any of this applies to you but something to think about.
Some things are working and the BA is still a nice place to be. I did a lot of corporate flying back in the late 70's there and the BA pollution combined with summer temperature inversions made most arrivals IFR when above 3000' or so, you could see all the way to the Sierras - but <3miles visbility below that meant filing for the approach. That's not a problem any more on most days. Hate on things like CARB as much as you want but you're breathing way cleaner air. 2 weeks ago I flew commercial into SFO and we had delays out of LAX due to low-viz in the BA but it was because of the fires. On most other days, the air is much improved, even with a much larger population and the same seasonal inversion layer. So yeah, it ain't the same but it could be a lot worse.
Enjoy it. Take a stroll down Geary St. Hob-nob and drink free wine waiting for a table at the Pacific Cafe. Hang out with the gliders at Fort Funston. Cruise Land's End. Get a pastrami on rye at Molinari's on Columbus, hop across the GGB and veg in the Marin highlands then drop down the hill and get a couple of pops down at Scoma's in Sausalito. I don't know where you live in the BA but it's all close, the air is soft and clean. Consider that lots of people from lots of places save and scrimp just to get a week's vacation there. Yes again, it ain't the same but no place is, even Idaho. I truly hope you can find a way to put aside the BS and enjoy the good stuff that is still there.
But back to Tesla.
Down today almost $30 (8.93%) in heavy trading to $305.50 with post market down again another $2.00. Pundits blame his flaky image in the NYT interview. Questions about his ability to stay on managing the company. But I think that little articles from researchers that screen credit card transactions and found that demand for the Model 3 is waning except for a few bursts when new versions like 'Performance' or AWD are made available. It doesn't look like they're going to sell anywhere near that 400-500K that the 'reservations' in 2016 suggested. It's gone from wait 1-2 years due to demand to order now, get it in a couple of weeks, maybe sooner - at least for the original version. The lots in Lathrop and Burbank have acres of cars stored. The question that many are asking is 'why are they there?' Tesla says those are just staging lots for delivery. But some are asking that with all of those 'confirmed' orders, why stop in Lathrop? Why not just load the cars onto trucks going to the delivery points and get them to those cash customers? Opinions vary from slack demand to cars built in that arbitrary 5000/mo. rate that they wanted to hit last quarter that are defective or incomplete to lots of opinions in between. Who knows but looking around fan sites like Tesla Motors Club. Pretty hard-core fans there but starting to get frustrated with multiple cancellations of their deliveries and, to put it succinctly, some really bad quality issues. Most are eventually happy when the get the car back from the body shop or whatever but you have to wonder what all of that rework costs TSLA.
While you're there, check out the 'Investor Relations' threads. Whew! Those guys are BELIEVERS. In Tesla, the electric revolution but mostly in Musk. And they put their money where Musk's mouth is - lately to big losses. But it's the shorts, the anti-TSLA media, lying NY times and the people that 'just don't get it' that are the blame. Only now, as some that bought heavily after the '420' tweet are realizing (lawsuits coming..) as they consider their heavy losses are they rethinking things. But a few of the faithful are doubling down and going long. Gotta admire their tenacity if not their financial acumen.
Point of reference: One of my kid's college roomies got his EE, parlayed his analytical skills into a very $ucce$$ful stint as an energy trader then turned down deep into 6 figures to go off on another venture. At a decent Tex-Mex joint here, I asked him what he thought of Tesla. He looked at me, held thumb to middle finger in an 'O' and said 'Going to zero'. Hard to say if he's right and I hope he's wrong for my stated reasons - but I wouldn't bet against him.
My prediction- Elon gets kicked upstairs. Tesla realizes it really is a car manufacturing company and not a tech company selling 15" tablets in a $50K box that you drive home. Responding to demands from institutional shareholders, they clean up the board of directors and install some real managers. It's too little too late and they go chapter 11. That discharges billions in debt and maybe restructures some tax incentive stuff in GF1 and 2. Ordinary bondholders and shareholders get wiped out. New Tesla arises from the ashes to make a credible run at BEV, energy storage and solar. They may even reset the Federal Income Tax Credit incentives which ran out at 200K delivered in Q3. With their tech and supercharger network acquired at pennies on the dollar they may have a a shot.
You heard it here first, folks.
But seriously, pastrami at Molinari's .. to die for.
'nite
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https://www.s3partners.net/Research/TSLA18.php?v=1
S3 Analytics: No Tesla Short Squeeze, Shorts up $1.2 billion since “The Tweet”
S3 Analytics: No Tesla Short Squeeze, Shorts up $1.2 billion since “The Tweet”
The russians had EV's in the 1980s?
That's hilarious. First, the article calls it "sleek", betraying an obvious bias. Then this gem from the spokeswoman: "“We’re talking about competing precisely with Tesla because it’s currently a successful electric vehicle project. We expect to at least keep up with it”.
I'm sure that strikes terror into the folks in Cupertino.
Yeah, I'm not going to get in front of one.
This is one thing I've never understood and really chaps me. How can a company file bankruptcy, get out of paying the people it owes, wipe out the people that own the company, keep everything, and then start up again basically stealing all of the capital that was technically owned by the shareholders or that was supposed to be standing good for debts?
At the very least, after restructuring anyone that owned 1% of the old company should own 1% of the new company.
Big business can abuse the Chapter 11 and 13 laws to the point of absurdity.
However, if your Average Joe did the same thing, he'd be prosecuted for fraud.
However, if your Average Joe did the same thing, he'd be prosecuted for fraud.
That's a politically charged way of looking at it! (Look at the transfer of GM from shareholders to the labor unions.)
Equity holders take on more risk than bond holders in return for a greater share of the potential upside. So if debt-holders are forced to take a haircut, the equity holders would be expected to suffer even more.
