If you’re into snake oil then Musk is your guy.
I recommend investing in Infiniti. Thanks to Leasehackr the qx60 outsold all apple products combined
I flip it all the time. I bought some today, I am up 1% as of closing. I will probably sell it when it hits 10% higher. The stock is highly volatile, it makes for great flips.
Is anyone worried about the EMF generated from a giant battery and powerful electric motor located just below your genitalia, day after day of driving? I know there’s conflicting evidence about it’s effects, and so far nobody’s reported birth defects or brain cancer etc. But that huge battery, with all that capacity and all that EMF coming from it, makes me wonder.
There’s a ton of EMF in our lives already, just not sure I want that much more. I rationalized a 330e with a tiny battery in the rear relative to Tesla’s might be less, but even the 330e has EMF from the electric motor (just below my butt), never mind the battery, compared to an ICE 330i.
One series on this:
I’m more worried about stumbling over the edge of the Earth one day and falling into the abyss…or whatever is there at the edge.
Goal post has been moved again.
Wel, I’ve peered over the edge and it ain’t pretty…
I work for a major electric utility in the upper midwest. I’ve been operating power plants for more than 35 years.
I take in more EMF in a single 12 hour shift than most will take in over a lifetime.
Price Target: $0.
Short of the decade. I’m honestly surprised to see no other members of the TSLAQ crowd on this forum, considering that most of the folks here are financially savvy.
Tesla is undergoing a semi-stealth restructuring as we speak. Liquidity has been tapped. Laying off tons of workers, closing stores, etc. This is supposed to be a growth company with new products coming out and they’ve cut Capex less D&A to ZERO. Huge red flag. There’s no cash to build the Y with. And that’s after changing some accounting policies to extend the useful life of expensive tooling.
They’re out of money. The ABL was just increased by $600m to keep the lights on as they work through liquidating inventory and keep suppliers from going COD to force the company into involuntary Bk. Make no mistake-- This line increase is to clean up significant inventory issues and strengthen DB’s position to supply the DIP loan for Ch 11. DIP loans are very lucrative and tend to be awarded to ABL lenders.
Tesla moved 63,000+ M3’s in Q4. So far in Jan and Feb they’ve moved 11k COMBINED. The growth story is dead. Find attached a picture of my local Tesla dealer’s overflow lot:
I’d hate to be the poor sap who gets one of these “new” cars. They’ve been encased in ice for over a week.
Lastly, I have some background in analyzing financial shenanigans and am 99% certain there is accounting fraud going on. I won’t get into too much detail here (glad to talk in further details in PMs), but here are three quickies:
Wire Fraud/Check Kiting:
There are many, hundreds it seems, of claims that long standing Model 3 depositors being asked to pay for their car in full then having their VINs reassigned to new buyers. This allows Tesla to effectively double book cash from sales for EoQ reporting.
Gross Margin Fraud
I am certain that the forensic accountants are going to reveal some egregious fraud we cannot even comprehend, but you don’t need to be The Accountant to see that Tesla is delivering incomplete cars, which are then returned to service centers to have their issues addressed. These issues have ranged from improper paint jobs, to non-functioning climate control, to broken seats, and even damaged batteries. The service center then books the completion of the vehicles as “Goodwill Repair.” Why is this significant? The expense goes into the line for “Service Expense.” In reality, this expense is COGS. The purpose is to inflate gross margins to promote this ridiculous idea that 25% gross margins are attainable. This is all very readily apparent from an hour of due diligence on the delta between Service Revenues and Service Expense over the past few quarters, and corroborated by receipts/invoices on forums/Twitter/etc.
Tesla is also intentionally underestimating warranty reserves, which is booked as cogs. These cars have way too many issues and are spending way too much time in service centers as Tesla pays for rentals. Some are even returning with very early catastrophic failures within warranty period like drive unit/battery, which costs ~$20k to replace.
- Dressing Up Cash Balance
Number of issues here, but the stated cash balance is NOT the accessible cash balance. Anyone want to tell me how it is I can earn 2.3% interest in an FDIC-insured Marcus savings account, but Tesla can only earn .79% interest on a $3.7b cash balance while the 1 year treasury yield was no less than 2.5% at any point during Q4?
The answer is clear-- Average cash balance was much closer to $1b than $4b during Q4. A portion of “cash” is credit tapped for EoQ reporting, and trade-ins being carried at inflated values that cannot be realized. When you realize that Tesla is carrying about $850m in customer deposits… Whoa. Dangerous territory for those depositors. They may end up having to petition Bk court as an unsecured creditors class… not good.
There’s many more red flags, from gaming VIN system to odometer rollbacks via software updates. I’m done for now, but again, happy to talk in more detail in PMs if anyone has further interested in the short thesis.
It must also really suck to have paid the pre-cuts prices on these cars. To see your residual take an instant hit like that is awful. Those folks have every right to be furious. And Musk discounting the autopilot vaporware for them, enticing them to give Tesla even more money, is so f*in absurd. But it will work on many.
Enterprise buys thousands of model S to give as loaner cars. My receipt even though its free shows $89 per day. Not sure what Tesla is really paying though.
Thanks for the informative post dig616!
Do you know if those photos are for used/certified cars, or brand-new? I’m guessing your photo is from MA. I’m shocked there would be that many new cars built & sitting for ‘quick sale’ – when they can be custom ordered and received in less than a month.
Not at all shocked the lot isn’t cleaned up given recent store announcements.
I’m on the fence about buying the 3 or upcoming Y. Incentives are great on them (federal + state). Price is reasonable. Tech is much better than other cars. But there’s enough stories of poor builds + questions on if the company can survive long term to make me hesitant.
Lots of gloom/doom in your dissertation.
Snow and ice covered new car lots happen in locations that get, well snow and ice.
Yeah, where is a picture of any other dealership in North East?
He made some valid points, but I don’t know if closing stores and laying off workers is a sign of a fledgling business.
Major established institutions are currently doing the exact same thing despite record profits and growth. It’s to create more growth where there wasn’t any before. Purely to appease shareholders.
Anyone interested in owning one of these horrible cars for free?
So that overflow lot is located in a spot on Rt 1 in MA known as “The Automile” for having dealerships up and down either side. 95% of the lots were cleared of all snow within 24 hours of the storm. The Tesla overflow lot was the only one that wasn’t.
Those cars are almost all new. Some have factory wrapping on them.
A few cars on the lot are used. There are a couple with auction stickers, implying reserve was not met. Basically, Tesla is sitting on a bunch of used vehicles with carrying values on the books well in excess of market value. Bad situation, but they can’t liquidate them below the reserve prices just yet because they can’t afford to book the write downs.
Again-- Not a good position to be in for a “growth company.”
Still, the biggest red flag is the simplest one. After moving 63k Model 3s in Q4, they’ve moved 11k through two months in Q1. Even smashing March out of the park won’t save the quarter. They had to throw everything at the wall to produce the best possible Q4 for the markets, so they pulled forward all demand on the backlog. There is very little demand left. That is the impetus for the recent price cuts.
Maybe all it means is that everyone that wanted a Tesla finally got their Tesla?
Did anyone actually think they’d be making record sales every quarter?
I recall reading analysts projections as far back as a year that hype over the model 3 would slow since those that wanted one and could afford one would get one. Electric car adoption is still limited for many reasons…
- cost of the cars
- what do you do with the batteries?
- not everyone has the type of home or property that could sustain having an electric car
- recharging infrastructure; though vastly improved is still limited in scale compared to traditional fuel
- time it takes to recharge electric cars puts off some folks
- did I mention the overall cost of the car, yet?
Electric car adoption is pretty much aimed at the upper middle class class and higher. It’s pretty limited as far as markets go.
Maybe in 10 years technology will advance and things will be different. My money is on Audi and Porsche pushing that.
Since “electric car” doesn’t mean only Tesla your points ar laughable at best! I’ll give you some real mumbers from own perspective.
My eGolf i can buy it for $16k (rv + lease) …more than comparable to the price of the gas Golf. My Clarity for $22k…what’s the cost of the Accord again?
“* what do you do with the batteries?”
What this has to do with you buying an ev?
“not everyone has the type of home or property that could sustain having an electric car”
True, luckily they won’t need to…see the v3 chargers just announced by Tesla or the 350kwh chargers in Europe.
“* recharging infrastructure; though vastly improved is still limited in scale compared to traditional fuel”
Soon to catch up and surpass it.
“ time it takes to recharge electric cars puts off some folks”
5 minutes for 75 miles is more than decent…and this is constantly improving too.
“* did I mention the overall cost of the car, yet?”
Yes, but when you don’t have a point, you can reapear to infinity and you still won’t have a point…at least not in US. And if you really cared about cost you would look at TCO. There are quite a few savings to be materialized due to not having an engine or using gas.
I would be worried when permashorts like you stop complaining about made up stuff…now then will be the time to short.