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    Re: Tesla Roadster

    "Moody's downgrades Tesla's (TSLA) corporate family rating to B3, senior notes to Caa1; Outlook is negative"

    (27 March 2018)

    Moody's downgrades Tesla's corporate family rating to B3, senior notes to Caa1. Outlook is negative.

    Moody's Investors Service downgraded Tesla, Inc.'s (Tesla) Corporate Family Rating (CFR) to B3 from B2, unsecured note rating to Caa1 from B3, and Speculative Grade Liquidity rating to SGL-4 from SGL-3. The outlook is negative.

    RATINGS RATIONALE

    Tesla's ratings reflect the significant shortfall in the production rate of the company's Model 3 electric vehicle. The company also faces liquidity pressures due to its large negative free cash flow and the pending maturities of convertible bonds ($230 million in November 2018 and $920 million in March 2019). Tesla produced only 2,425 Model 3s during the fourth quarter of 2017; it is currently targeting a weekly production rate of 2,500 by the end of March, and 5,000 per week by the end of June. This compares with the company's year-earlier production expectations of 5,000 per week by the end of 2017 and 10,000 by the end of 2018.

    The Caa1 rating of the unsecured notes reflects the junior position of the notes relative to the company's $1.9 billion secured credit facility.

    Tesla continues to benefit from solid market acceptance of Models S and X, which collectively hold over a third of the US luxury market. In addition, third-party evaluations of the Model 3 remain favorable, consumer response to the vehicle is sound, and advance purchase reservations and deposits remain high. Finally, regulatory support for battery electric and zero-emission vehicles continues to grow.

    The negative outlook reflects the likelihood that Tesla will have to undertake a large, near-term capital raise in order to refund maturing obligations and avoid a liquidity short-fall. Prospects for addressing its liquidity requirements (whether equity, convertible notes or debt) will be supported if the company can establish credibility for reaching Model 3 production levels -- 2,500 per week by the end of March, and 5,000 per week by the end of June.

    Tesla's liquidity consists principally of $3.4 billion in cash and securities at December 31, 2017. The company also has moderate availability under the $1.9 billion ABL facility. This liquidity position is not adequate to cover:

    1) the approximately $500 million in minimum cash that we estimate Tesla must maintain for normal operations;

    2) a 2018 operating cash burn that will approximate $2 billion if Tesla maintains high discretionary capital expenditures to increase capacity; and

    3) convertible debt maturities of approximately $1.2 billion through early 2019.

    These cash needs will likely require Tesla to undertake a near-term capital raise exceeding $2 billion. Moreover, if the company maintains its expected pace of expansion, it will likely need to raise additional capital during the second half of 2019.

    Tesla's rating could be lowered further if there are shortfalls from its updated Model 3 production targets. The rating will also be pressured if the company is unable to raise sufficient new capital to cover its late-2018 and early-2019 convertible maturities, and to cover the operating cash consumption that will likely continue into 2019.

    The rating could be raised if production rates of the Model 3 meet Tesla's current expectations and if the company maintains good liquidity.

    The following rating actions were taken:

    Downgrades:

    ..Issuer: Tesla, Inc.

    .... Probability of Default Rating, Downgraded to B3-PD from B2-PD

    .... Speculative Grade Liquidity Rating, Downgraded to SGL-4 from SGL-3

    .... Corporate Family Rating, Downgraded to B3 from B2

    ....GTD Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1 (LGD4) from B3 (LGD4)

    Outlook Actions:

    ..Issuer: Tesla, Inc.

    ....Outlook, Changed To Negative From Stable

    Link: https://www.moodys.com/credit-ratings/Tesla-Inc-credit-rating-823642219


    Re: Tesla Roadster

    "Tesla hits another bump in the road with Moody’s downgrade" (FT)

    (27 March 2018)

    Moody’s added to the recent woes of Tesla investors late on Tuesday, taking the company’s junk-bond credit rating down a notch to B3 and warning it may fall further if the company has trouble raising $2bn or so of fresh capital.

    The rating agency’s move came at the end of a day in which shares in Elon Musk’s electric carmaker had already fallen more than 8 per cent. Debt investors have not been spared the pain, with the company’s 2025 unsecured notes trading at about 89.7 cents on the dollar.

    In a note explaining its move, Moody’s said production delays for Tesla’s Model 3, launched last summer, were putting financial strains on the company. Tesla had $3.4bn in cash at the end of last year.

    But Moody’s predicted it would need $2bn this year to cover its operating cash burn as it scales up production of the Model 3 production. With $1.2bn of convertible debt maturing by early next year, and the need for a cash cushion of at least $500m, that means Tesla will have to return to the financial markets again to keep a comfortable financial cushion, the agency said.

    Tesla has pushed back its target twice for reaching a production rate of 5,000 Model 3s a week, and now predicts it will reach that level by the end of June. It has dropped its deadline for reaching a 10,000 vehicle a week production rate altogether. Moody’s said further production problems could also result in another downgrade.

    Tesla declined to comment. It is expected to give an update on Model 3 production when it announces fourth quarter delivery numbers early next week.

    Link: https://app.ft.com/content/c4ebb102-3202-11e8-b5bf-23cb17fd1498


    Re: Tesla Roadster

    Nothing really new though.

    Everyone and their mother knows Tesla needed some major cash infusion some time this year to survive, possibly the around the first half of the year, which we are almost there.

    But the major drop in stock prices today might trigger some debt call backs though and pinch their liquidity even further, THAT might cause a run on the stock price especially the psychological support of $300 is gone like it's nothing, if more bad news pile on, don't be surprise to see Tesla at around $200, or even worse.


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    Re: Tesla Roadster

    Whoopsy:

    Nothing really new though.

    Everyone and their mother knows Tesla needed some major cash infusion some time this year to survive, possibly the around the first half of the year, which we are almost there.

    But the major drop in stock prices today might trigger some debt call backs though and pinch their liquidity even further, THAT might cause a run on the stock price especially the psychological support of $300 is gone like it's nothing, if more bad news pile on, don't be surprise to see Tesla at around $200, or even worse.


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    Based on the stock price (-8% yesterday) this was indeed big news to the market, it seems Smiley


    Re: Tesla Roadster

    MKSGR:
    Whoopsy:

    Nothing really new though.

    Everyone and their mother knows Tesla needed some major cash infusion some time this year to survive, possibly the around the first half of the year, which we are almost there.

    But the major drop in stock prices today might trigger some debt call backs though and pinch their liquidity even further, THAT might cause a run on the stock price especially the psychological support of $300 is gone like it's nothing, if more bad news pile on, don't be surprise to see Tesla at around $200, or even worse.


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    Based on the stock price (-8% yesterday) this was indeed big news to the market, it seems Smiley

    The news on credit rating is worth keeping in mind for any customers that have a deposit (unsecured) with Tesla... Smiley


    Re: Tesla Roadster

    Maybe Tesla will be history soon. -20% in less than a week. This does look very serious.


    Re: Tesla Roadster

    Whoopsy:

    Nothing really new though.

    Everyone and their mother knows Tesla needed some major cash infusion some time this year to survive, possibly the around the first half of the year, which we are almost there.

    But the major drop in stock prices today might trigger some debt call backs though and pinch their liquidity even further, THAT might cause a run on the stock price especially the psychological support of $300 is gone like it's nothing, if more bad news pile on, don't be surprise to see Tesla at around $200, or even worse.

    Im not a bright guy when it comes to finance, but what if china put some bands while Trump did the same,would this affest Tesla?


    Re: Tesla Roadster

    martini964:
    Whoopsy:

    Nothing really new though.

    Everyone and their mother knows Tesla needed some major cash infusion some time this year to survive, possibly the around the first half of the year, which we are almost there.

    But the major drop in stock prices today might trigger some debt call backs though and pinch their liquidity even further, THAT might cause a run on the stock price especially the psychological support of $300 is gone like it's nothing, if more bad news pile on, don't be surprise to see Tesla at around $200, or even worse.

    Im not a bright guy when it comes to finance, but what if china put some bands while Trump did the same,would this affest Tesla?

     

    Did you meant to type bans?

    Banning auto-pilot cars would be bad news for Tesla, heck just making it more regulated will affect them, it was their one major selling point.

    2hrs into today's session and Tesla lost another $20+ and now at the $250 range. 

    Tesla needed one thing and one thing only, money. There is only 2 ways for it to get that, either borrowing or turned existing deposit into orders.

    First part they are almost tapped out, their credit line is almost maxed and the 2nd part they are way behind on production target to covert the Model 3 deposits into cars.

    They have no choice now but to go to the market and issue more debt, but that also hinges on them maintaining a high stock price.

    It's a catch-22 right now for them.They badly need some good news to prop up the stock price but the bad news wouldn't stop.

     

     


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    Re: Tesla Roadster

    yes,Thanks for info


    Re: Tesla Roadster

    Well, Elon Musk has lots of money. He could in theory sell some and loan it to Tesla or give it to someone as collateral...


    Re: Tesla Roadster

    He didn't make all that money by being stupid...


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    ⇒ Carlos - Porsche 991 Carrera GTS


    Re: Tesla Roadster

    Well, he just got a potentially multi-billion dollar compensation package. I'm sure he can float them a $1B if he thinks that's the difference between failure and success.


    Re: Tesla Roadster

    I hope tesla will resist and produce a lot of cars....go tesla go


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    993 c2


    Re: Tesla Roadster

    noone1:

    Well, he just got a potentially multi-billion dollar compensation package. I'm sure he can float them a $1B if he thinks that's the difference between failure and success.

    One hopes that you don’t manage a business. 


    Re: Tesla Roadster

    noone1:

    Well, he just got a potentially multi-billion dollar compensation package. I'm sure he can float them a $1B if he thinks that's the difference between failure and success.

    I guess you may not have been aware that members of senior management having been selling Tesla shares for a while (including the family) and executives have been leaving the firm... do you think an insider has visibility on the next 12 months? Smiley

    If you have a deposit with Tesla, either ask for it back (quickly) or hedge your exposure. On the back of the rating downgrade and stock proce plunge, that liquidity crisis at Tesla may arrive during Q2... Smiley


    Re: Tesla Roadster

    noone1:

    Well, he just got a potentially multi-billion dollar compensation package. I'm sure he can float them a $1B if he thinks that's the difference between failure and success.

     

    Tesla needs much more than a billion dollars............

    They burn through more than that a quarter.

    Most of Elon's net wroth is tied to Tesla's stocks anyway, so his net worth is quite a bit less now.

    His gigantic compensation package is tied to him leading Tesla to be a 100 billion dollar worth company, it's half that right now.

    His vision of entering the low margin low cost electric car in order to gain market share is great on paper......until one sees examples everywhere that it doesn't work. Look at Samsung with their phones, they tried to go high up against Apple and low against Chinese stuff, it failed on both fronts. The Chinese are eating away at Samsung's market share like crazy at the low end, and Samsung is losing out to Apple big time on the top end, it's stuck in no man's land right now.

    Car business is a cut throat one, at the low end of the market there are a ton of alternatives, perhaps he had envisioned he can make those cars on schedule without problems to entrench themselves, but they forgot to look at the mirror, they had never had a model that went without problems, so why should the Model 3 be different? All the delays are eating into their planned revenue, their scheduled expenses was there assuming they get their cars out on time, it didn't happened. Now they are stuck between a rock and a hard place, either beg for more money just to survive, and hope their Model 3 production finally can hit their targets, or scale back their ambitious expansion plans to preserve capital and thus delaying the Model 3 even more. 

    Lenders lend them money on the basis that they were a 50-60 billion company with a revenue stream to match. The lending terms and rates would be very different when they are down to a 30-40 billion company that keep losing money. People bid up their stock prices thinking there is growth, but when they company can't grow, nobody will want that stock, and the vicious cycle starts, the lower the stock price, the harder they can gain liquidity.

    Believe it or not, Tesla is closer to filling Chapter 11 than ever. Their enormous debt needs some serious restructuring in order for Elon to fulfill his vision. We know Elon absolutely do not want to part with any of Tesla's assets, so a Chapter 7 is out of the question.

    They should have gone into truck business a lot sooner, before doing the entry level Model 3. Trucks have higher margins and zero competition, no other companies are even close to doing a all-electric semi truck, Tesla would have made a killing there and stock up on money/ammo, and that's what needed to enter the mass market entry level cars. DEEP POCKETS. 

    For some Tesla fanboys, this is like Tesla bashing again. It's not. It's just taking a rationalized view on fundamentals, dig deeping into press releases and finance records to see if there are any coverups. And there are plenty within Tesla. 

     

     

     


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    Re: Tesla Roadster

    Good points, well made.

    It is also worth keeping in mind that the market would usually expect an update on The Tesla credit rating from Standard & Poor's to follow the Moody's downgrade. This may be a further catalyst to deflate the TSLA stock price.

    For example, here is a comment on Tesla from S&P in their November 2017 update on the Auto sector...

    "For Tesla, we expect lower initial gross margins of the Model 3 due to under- absorption of labor and overhead costs in 2017 and early 2018, with modest improvements later in 2018, and gross margins approaching 25% in 2019 through ongoing cost reductions and improved manufacturing efficiency." -- S&P

    Those familiar with Tesla's recent financial performance will recall that they have been reporting negative gross margins on the Model 3... Smiley

    PDF Link: https://www.spratings.com/documents/20184/1481001/ITT_Autos_2018.pdf/a4950577-8cf0-4d0b-8d52-3c8ac13ef0be


    Re: Tesla Roadster

    Maybe now finally Apple will buy them. The growth seed is there. They just need capital. And Apple needs the next big thing and has more capital than they know what to do with


    Re: Tesla Roadster

    DaveChapin:

    Maybe now finally Apple will buy them. The growth seed is there. They just need capital. And Apple needs the next big thing and has more capital than they know what to do with

    Still significantly overvalued plus Apple never paid anywhere as much for any acquisition.  Beats, which Apple overpaid, is the highest paid, at a mere $3 billion.  Tesla becomes a viable acquisition at $10-15 billion but that valuation indicates that the company is quickly entering receivership.  Tesla has a debt overhang with $1 billion due within one year, the sums escalate over the next five years.  However, the company has accounts payable of $2.4 billion and if those suppliers become skittish of Tesla’s financial situation and demand cash on deliver, the company is finished.   This is what happened most recently at Toys R Us.

    A better plan for Apple to enter the EV market is to acquire a startup, for example SF Motors, a Chinese sponsored company which was started by the two original Tesla founders, one remains with the company.  https://www.forbes.com/sites/alanohnsman/2018/03/28/china-backed-sf-motors-debuts-electric-suvs-as-rival-tesla-hits-rocky-patch/#48db654e199a

    Another potential target is Lucid Motors.   

     


    Re: Tesla Roadster

    Will he US government step in and try to save it? It has been giving it financial support. 


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    Where the willingness is great, the difficulties cannot be great.


    Re: Tesla Roadster

    Amazon will it!


    Re: Tesla Roadster

    nberry:

    Will he US government step in and try to save it? It has been giving it financial support. 

     

    That' a good question.

    Tesla is not part of the big 3. Tesla is not unionized. Big 3 are unionized, so politicians had an incentive to bail them out so they can claim they saved their jobs in exchange for votes. Tesla doesn't have that luxury.

    Tesla has a big market cap but not really a big company with many employees, only politicians in California might think about saving it. Others, might actually want it to die in order for the big 3 to regain market share in alternative fuel vehicles. 

    Tesla's financial aids were mostly in the form of tax relieves and green credits mostly, not really a direct injection of money. Government can always grant those to someone else. 

    So the answer is no, US Government is under no incentive to bail Tesla out. 

    The wild card is Trump though. He has been trumpeting 'Made in America', and Tesla is that. So in the end the irony might be Trump, the president Californians hated the most, will be the one saving their state's car company. But then again half the politicians in California would rather eat poop than say thank you to Trump Smiley


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    Re: Tesla Roadster

    So it would seems the end of 1st quarter looming around the corner is saving Tesla's stock price. 

    After breaching $250, I think quite a few Tesla shorts are covering their bets to book profit for the quarter. 

    Barring anymore bad news, seems like $250 would be the support it needed. 


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    Re: Tesla Roadster

    Nick ,the incentive is Tesla, accelerated the EV credibility causing other car manufactures to jump in sooner than they were ready to do so. Losing Tesla now would send the wrong message. That said, our government is control by conservatives and I'm not sure they will want to save it.


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    Where the willingness is great, the difficulties cannot be great.


    Re: Tesla Roadster

    nberry:

    Nick ,the incentive is Tesla, accelerated the EV credibility causing other car manufactures to jump in sooner than they were ready to do so. Losing Tesla now would send the wrong message. That said, our government is control by conservatives and I'm not sure they will want to save it.

     

    Tesla did not pioneered that segment, Porsche had a EV car over 100 years ago, it's called the Porsche P1. It has a motor for each of the 4 wheels, something Tesla copied actually. Tesla championed that segment, but Tesla is not needed to sustain that segment. Most manufacturers already have EV car plans in their future, fully committed and financed, those plans are not easily axed. 

    Losing Tesla won't kill that segment, it just proof to people that one cannot run a company recklessly and through smoke and mirrors. And losing Tesla means the market might actually expand. Tesla simply don't have the capacity to expand to meet demand of the lower price point car, others have and can, to make a EV car affordable, economics of scale is needed, parts sharing and stuff, GM, VW and others can do it by using parts from other cars, no need to bespoke everything for a cheap car, that lowers the cost immensely and can make a car profitable. 

    Don't drag the conservatives into this one, as even the democrats would have had a hard time justifying saving a car company that's not unionized. Saving Tesla or not is a purely business decision, is it sound business plan to save a money black hole, a company that had never demonstrated they can actually make money making cars?


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    Re: Tesla Roadster

    nberry:

    Nick ,the incentive is Tesla, accelerated the EV credibility causing other car manufactures to jump in sooner than they were ready to do so. Losing Tesla now would send the wrong message. That said, our government is control by conservatives and I'm not sure they will want to save it.

    While your text is addressed to Nick, one will take liberty to add some thought to this posting and your previous posting.  While there is a conservative in the White House, and both houses of Congress are technically controlled by a Republican majority, one can hardly declare that the entire U.S. federal government is controlled by conservatives.  One does realize that you consider conservatism a disease or mental disorder but no one political ideology defines the federal government with its multiple legions of career bureaucrats.  

    The 2009 bailouts of Chrysler and General Motors under the Obama Administration actually started in 2008 under the Bush Administration.  This was an unique set of parameters and it is quite doubtful that any other administration would essential nationalize two major players in an oligopoly unless there were significant stakeholders, i.e., unions representing the workforces of both Chrysler and General Motors.  Tesla, as a non-union company does has fewer significant stakeholder blocks.  Government is not a venture capitalist and it has, even with DARPA and related entities, in the Department of Defense a horrible track record of picking economic winners and losers.  Even in the realm of private sector venture capital, economic success is fleeting.  Often investments are made too early ahead of a pending market or technological advance or investments are made where there are no sustainable markets.  That's life in venture and private equity.  

    As one has stated before, Tesla's potential downfall is its charismatic leader, Elon Musk, and his inability to proactively manage the process.  While many may see him as a visionary, he took the company into a direction that is not conducive to financial stability.  In essence, he over promised and under delivered.  Tesla is not an innovator in the EV space and its sole innovation was design of the product coupled with a very large battery that gave low acceleration times coupled with relatively long range.  Musk promised a dreamy world of manufacturing with machines-that fabled Alien Dreadnought-fabricated millions upon millions of nearly identical cars.  In reality mass producing is an experience and capital based endeavor, something that Tesla lacks.  

    If Tesla stayed a niche builder of premium EVs, its financial prospects would be much stronger.   However, Musk's compensation plan was tied toward meeting high volume production figures which included the mass market Model 3 and Model Y.   Musk, as an effective manager, needed to work with his board and his major investors to derive a suitable compensation plan, that while still maintaining stretch goals, realistically projected financial targets.  Musk also needed to temper the market's expectations for the company.  Tesla's current market capitalization is similar to that of Ford Motor Corporation, a company that produces 35,000 units daily and leads the industry in the volume of premium vehicles (F-150 pickup trucks and SUVs) priced above $50,000.  That valuation signifies a tremendous production ramp combined with very high gross margins.  When Tesla's gross margins are adjusted to the industry standard, profitability essentially vanishes.  

    Tesla' greatest challenges today is not the capital markets.  For some reason, there are still plenty of small investors still enamored with Musk vision of Tesla to support additional debt financings, even a high yield interest rates.  Instead, Tesla faces demand for cash upon delivery from its suppliers.  Current accounts payable at Tesla are in excess of $2.4 billion.  Note that this is much greater than $1.0 billion of debt coming due this year.  Tesla's financial position isn't too dissimilar to that of Toys R Us.  Toys R US, while with a heavy debt load, wasn't able to generate enough cash to pay its suppliers, which then refused to provide trade credit.  Once trade credit was denied Toy R Us, it faced liquidation.  


    Re: Tesla Roadster

    Whoopsy:
    nberry:

    Nick ,the incentive is Tesla, accelerated the EV credibility causing other car manufactures to jump in sooner than they were ready to do so. Losing Tesla now would send the wrong message. That said, our government is control by conservatives and I'm not sure they will want to save it.

     

    Tesla did not pioneered that segment, Porsche had a EV car over 100 years ago, it's called the Porsche P1. It has a motor for each of the 4 wheels, something Tesla copied actually. Tesla championed that segment, but Tesla is not needed to sustain that segment. Most manufacturers already have EV car plans in their future, fully committed and financed, those plans are not easily axed. 

    Losing Tesla won't kill that segment, it just proof to people that one cannot run a company recklessly and through smoke and mirrors. And losing Tesla means the market might actually expand. Tesla simply don't have the capacity to expand to meet demand of the lower price point car, others have and can, to make a EV car affordable, economics of scale is needed, parts sharing and stuff, GM, VW and others can do it by using parts from other cars, no need to bespoke everything for a cheap car, that lowers the cost immensely and can make a car profitable. 

    Don't drag the conservatives into this one, as even the democrats would have had a hard time justifying saving a car company that's not unionized. Saving Tesla or not is a purely business decision, is it sound business plan to save a money black hole, a company that had never demonstrated they can actually make money making cars?

    It sounds unlikely that there would be a "white knight" rescue for Tesla, particularly given the amount of debt outstanding and the poor track record in manufacturing. If the company fails to raise enough capital to remain solvent, it is reasonable to expect there would be a debt restructuring / writedown / debt-to-equity swap, e.g. via Chapter 11.

    To state the obvious, if there is a financial restructuring at Tesla, it is entirely possible that the existing share class will be worth zero, as previous debt holders (e.g. secured lenders, bondholders) become the new de facto equity holders.

    Maybe worth keeping in mind that where a stock price has previously traded means very little in a debt restructuring scenario. In that scenario, the ranking of creditors is key in slicing up the new capital structure and the ordinary shareholders face the ultimate risk of being wiped out. That is why shareholders should care when the Tesla bonds start trading materially below par. If bondholders are looking at a write-down in principal value, shareholders would be facing a write-off.

    There could be a bidder to acquire the company / brand following a financial restructuring, as the debt would have been reduced and the equity market cap would be a distant memory... along with a bunch of customer deposits! Smiley


    Re: Tesla Roadster

    Thanks for your dissertation but you misjudge me. I have Republican blood in me. I know how our federal government works. When it comes to spending money each administration puts in place people that mirror and execute their views. Its no different with Trump. The career underlings cannot control policy. They only follow.

    I also believe you underestimate the brand of Tesla in the market place. When one thinks of EV vehicles only one brand comes to mind. TESLA! They are innovators in EV technology. Their presence in the market place forces all car companies to innovate because the future of cars is EV. I don't know if Tesla will survive but I do know one should never count Musk out.Smiley


    --

    Where the willingness is great, the difficulties cannot be great.


    Re: Tesla Roadster

    nberry:

    Thanks for your dissertation but you misjudge me. I have Republican blood in me. I know how our federal government works. When it comes to spending money each administration puts in place people that mirror and execute their views. Its no different with Trump. The career underlings cannot control policy. They only follow.

    I also believe you underestimate the brand of Tesla in the market place. When one thinks of EV vehicles only one brand comes to mind. TESLA! They are innovators in EV technology. Their presence in the market place forces all car companies to innovate because the future of cars is EV. I don't know if Tesla will survive but I do know one should never count Musk out.Smiley

    Globally it is Nissan/Renault and an assortment of Chinese brands. 


    Re: Tesla Roadster

    nberry:

    Thanks for your dissertation but you misjudge me. I have Republican blood in me. I know how our federal government works. When it comes to spending money each administration puts in place people that mirror and execute their views. Its no different with Trump. The career underlings cannot control policy. They only follow.

    I also believe you underestimate the brand of Tesla in the market place. When one thinks of EV vehicles only one brand comes to mind. TESLA! They are innovators in EV technology. Their presence in the market place forces all car companies to innovate because the future of cars is EV. I don't know if Tesla will survive but I do know one should never count Musk out.Smiley

     

    As a person with experiences in finance and stocks, IF Tesla's valuation is at around 5-7 billion, I would totalling buy it out.  And that's already including perhaps a 40% premium.

    Right now its worth about 8-10 times more than it should, and I wouldn't, it's just not a sound business decision.

    There is nothing special about Tesla, everything it can do, someone else can do. It occupied a niche market segment, nothing more. The Tesla fan boys can claimed whatever they want, it's just numbers, I can use the exact sam set of numbers and present a completely opposite case of whatever they want to trumpet with.

    But yes, in North America, when one think of EV, one thinks of Tesla first, that may not and is not the case world wide. To be frank, Tesla makes expensive EV cars, but nothing on them is class leading, content wise, interior is only on par with perhaps a Camry, an Accord and that's about it. The electric drivetrain eats up pretty much all of the cost of a Tesla Model S or Model X. 

    Seriously, I when I sit in a Tesla, without driving it, just touching surfaces, they are even inferior to my Golf R. Not to mention my 4C, which btw have leather and stitched dash. Something that not even all the 911 gets.

    Model S, and Model X has some amazing acceleration stats, but those are not sustainable. Try doing acceleration runs and it would be quite apparent.

     


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