Tesla bankruptcy?

Hope for the best and expect for the worst. Hoping Elon is not another Elizabeth Holmes.

Govt will bail them. Tesla is too big to fail. Majority of EV sales are up becase of subsidies.

Exactly - it is tough to be a non-niche international car manufacturer.
Stand alones are:
The big 3 Japanese
Ford/GM
The Big 3 Germans
Hyundai
Some of the Chinese
Peugeot

The rest are just amalgamations and I would argue that further consolidation is coming ā€¦

And hoping he wonā€™t end up like the original Tesla - brilliant yet bankrupt :slight_smile:

I do find it very interesting how many people want Tesla to fail so badly. One of the only car manufactures in the US that isnā€™t outsourced, pushing technology at an accelerated pace, with factories in the US, with US workers along with shaking up the auto industry for good.

Yet people are foaming at the mouth and canā€™t wait for them to fail, or are actively trying to make them fail. But then turn around and say ā€œsupport US jobs!ā€, baffling.

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This government bailing out EV company? :face_with_raised_eyebrow:

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Sergio has been begging for someone to hook up with FCA for a few years now. He would agree.

So accurate. I canā€™t help but think the same thing. Itā€™s amazing to me that people wouldnā€™t want a company like this to succeed.

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Tesla goes BK, leasehackrs will crowdfund a bailout for lifetime $99/mo leases.

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Thought it would chime in with a little perspective on the #s for context

Even after the sharp drop in share price, TSLA is currently a $45+bln company (market capitalization), very similar to Fordā€™s 45bln and just below GMs 50bln. Back when TSLA was above $350 it was bigger than all the big/traditional US car manufacturersā€¦ yes, vastly overvalued given that they produce a tiny fraction of the cars the big 3 produceā€¦ but the point is TSLA trades like a growth/tech stock. Even if it drops by 50% it would be a HUGE takeover bid for any existing car manufacturer (freebie data point for context, Tata paid less than 2.5bln for both jaguar and range rover back when Ford sold the brands at a loss). Takeover seems unlikely in the near term.

Companies go into bankruptcy usually due to debt (and the main goal while in bankruptcy is to wipe most of that debt, along with completely wiping out equity holders). Teslaā€™s financial statements show about 10bln in long term debt, you can do the math but EXISTING debt alone wont take down the company.

TSLA has fueled growth by selling shares post the IPO (raising additional capital, far outpacing the issuance of debt), and the strategy has worked bc the share price has kept on increasing. The immediate problem for TSLA is if they are no longer able to roll debt (or if they do at much higher rates -worth mentioning that TSLA issued convertible bonds, in addition to ā€œregularā€ bonds and term loans, but thats a capital markets lesson for another day-) and if they sell additional stock to raise capital the price at which they sell would be lower than recent highsā€¦ that dilutes shareholder value which may in turn trigger more selling, and a lower share price and more sellingā€¦ until the stock hits an ā€œintrinsic/fundamental valueā€ level when buyers step in to build positions(or it plummets into insolvencyā€¦ welcome to wall street!)

Lastly, and without the intention to get too technical, if you look at company earnings releases and financials you will see that TSLA is about 4 businesses under the same ticker, 1) core auto business, 2) Tesla Network (used to be called Mobility), 3) SolarCity and 4) Tesla Energy. Using a simple DCF model***, businesses 1 and 2 alone would support a share price of north of ~$325 (TSLA is trading at $250 as of this morning).

***Read any publicly available research reports on TSLA, start with DCF (discounted cash flow) models, focus particularly on WACC (weighted average cost of capital) and EBITDA (earnings before interest, taxes, depreciation and amortization) assumptions.

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No way man, i saw the fox news comments. you are WRONG and those are the FACTS. :stuck_out_tongue:

(I like thoughtful analysis of actual business structures, seems a lot of people just think that business financials is simply money in and money out on a daily basis)

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Tesla may be in even more doo doo:

If itā€™s confirmed Autopilot is what steered that Model X straight into that barrier, Elon/Tesla will have bigger things to worry about than a tanking stock price.

Hereā€™s the original article with more details:

Unless the economy crashes, there is no way they are not getting more capital. You are not going to see chapter 7 for Tesla. They are growing like crazy, but not as much as Elon Musk promises. The truth is probably somewhere in between. As with any Tesla news, beware who and where it is from. On one side you have the fanboys, who thinks Tesla canā€™t do no wrong. On the other, you have people that wants it to die for no apparent reason. Itā€™s really funny how the dynamic works. If you become an owner, you will know what I am talking about.

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This is like a perfect reason to start a conspiracy theoryā€¦

You do know the service records show there was nothing right. Itā€™s all the clickbait stuff.

Note how everyone is a saint when they dieā€¦

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Wow, youā€™ve seen the service records? Do you work for the NTSB?

He also makes a startling claim ā€“ that before the crash, Walter complained ā€œ7-10 times the car would swivel toward that same exact barrier during auto-pilot. Walter took it into dealership addressing the issue, but they couldnā€™t duplicate it there.ā€

Dan Noyes: ā€œThe family is telling me they provided an invoice to investigators, that the victim took the car in because it kept veering at the same barrier. How important is that information?ā€

Christopher Oā€™Neil, NTSB: ā€œThat information has been received by the CHP, theyā€™ve been acting on it for some time now.ā€

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So when your Model 3 arrives, donā€™t dare complain else you may be killed under suspicious circumstances.

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Unless weā€™re talking about a company like Google or Apple, both of which have been rumored to be in the car realm at one point or another. They could pull out the change in their lobby cushions and not bat an eye.

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Walter wins the Darwin awards ā€¦ Bro if your autopilot be flaky, donā€™t be using that nigg*** no more

Exactly, after a set number of complaints is logged against a VIN, the Tesla HQ commandeers the autopilot and drives it to the nearest concrete barrier ā€¦

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His service center probably told him OTA updates were on the way soon, so that any problem would be fixed so heā€™d be fine using AP.
How many people need to die before Tesla is forced to change Autopilotā€™s misleading name? It only took 1 death in China before Tesla was forced to change it. Weā€™re up to probably 2 now in the US.

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