I can't vouch for the author of this piece, but I think he hits most of the issues I've been watching over the last year or so. I do believe he's a bit deluded if he thinks Elon would ever consider selling Tesla and staying on to work for its new owner(s). There's way too much ego in Elon for that to ever be a possibility. Personally, I'm trying to pick the right point to start shorting Tesla stock.

Read the article and offer your opinion for the following question. "Does Tesla have an escape plan, and if so, what will it be?"

https://theresurgent.com/2019/...n-corner-sell-tesla/

Tesla's biggest problem is they now have some serious competition with both all electric and hybrid options from large auto companies and the gov. incentives are going away. If I were in his shoes I'd cut my loses and move to some other endeavor.

Jim

^^That might be boring

quote:

"Does Tesla have an escape plan, and if so, what will it be?"

No.
Tesla is Elon and so Tesla has no plans outside the Elon's head.
The more interesting question is "Does Elon have an escape plan (from Tesla)?"
... and I bet he does, but it's fuzzy.

quote:

Personally, I'm trying to pick the right point to start shorting Tesla stock.

I was short TSLA last year (June) for about two weeks. I couldn't sleep. I woke up wondering what Elon was tweeting now. Elon has a cult of personality. His fans think he can do no wrong and will buy into any dip. It's kind of bizarre ... but it took my attention away from too many other important things. It did pay for a nice vacation, but I spent too much time watching the stock price.

Elon should have an exit strategy.
So should Tesla, but the board is made up of Elon fan-boys.

A couple of points from the article:

Let’s review a bit before Tesla releases its Q1 financials.

- TSLA stock is trading at a massive premium, despite losing 30% of its value since December 2018. Its earnings per share has gone from a profitable $0.84 on 12/31/18 to $-4.19 at the end of March.
- Elon Musk owns 21.7% of Tesla stock, and has personally pledged nearly 40% of his stock as collateral against personal debt. That’s a market value of $4.4 billion. Since 2010, that percentage has increased over 3700%.
- Tesla’s Balance Sheet is a terrible mess. On paper, the company is $1.6 billion short in current assets should its suppliers and creditors call debt. In accounting terms, that’s called insolvency.

Tesla showed the ability to "show" a profit even if based on accounting gimmicks. That (temporarily) was painful for short sellers.

The author is right that Elon should be quietly looking for a buyer of his shares. But... he's probably not, and won't until he has no choice.

quote:

Originally posted by Jimbo54:
Tesla's biggest problem is they now have some serious competition with both all electric and hybrid options from large auto companies...

Jim

I do not disagree, but you're talking future issues. The issues/problems noted in this article are past problems that are all coming together at the same time to highlight just how insanely unstable the financial health of Tesla really is.

Tesla reporting big reductions in sales volumes for Model S & X vehicles in the first quarter (i.e. their big margin products) coupled with Tesla being unable to hit Model 3 sales projections, coupled with the freezing of the Gigapower expansion, coupled with Tesla's weak cash position and debt service obligations, coupled with Moody's and Morgan downgrading their positions in Tesla, are all coming together to really bring this to a head.

My greatest fear is, if Tesla and the Gigapower venture go belly up, will SpaceX also fold. SpaceX is the one company I'd like to see survive all of this and continue down the path they're on, re-writing the books on space travel.

Not that it wasn't expected.... Tesla stock falls after car maker misses Q1 views.

A couple important takeaways....

"Adjusted for one-time items, Tesla lost $494 million, or $2.90 a share...

Revenue reached $4.5 billion..."

"Analysts polled by FactSet had expected an adjusted loss of $1.15 a share on sales of $5.4 billion for the quarter."

So Tesla was off their market projections by almost a billion dollars in revenue and the per share loss was 2.5 times analyst expectations. Wow!

C'mon, are we really speculating about Tesla's future on an article from The Resurgent? Tesla is up 29% since I bought it and their future in battery technology is looking pretty good, contrary to the article. I had Panasonic stock for a long time and dumped it because it was a non performer. I'm going to hang with Tesla.

Go Dave!

On a side note, I have a framed certificate for 100 shares of Enron.

Just came back from a trip to Northern Europe - Denmark, Sweden, Norway, Holland and Germany.

Saw lots of Teslas there, even the occasional Tesla taxi. Appears popular over there.

quote:

Originally posted by deepocean:
^^That might be boring

Or off of this planet...

It’s never a good thing when a car company is building cars in the parking lot.

quote:

Originally posted by Chris42:
Just came back from a trip to Northern Europe - Denmark, Sweden, Norway, Holland and Germany.

Saw lots of Teslas there, even the occasional Tesla taxi. Appears popular over there.

Tesla are doing well here in yUK, too. I see them every day.

I think they will be OK.

Almost every woman I know wants a Tesla. Not every dude, mind you, but damn near every woman I know in her late thirties or older, who drives daily, wants a Tesla of some flavor.

I'm just saying I'm looking around and I see a lot of Teslas zooming around here. And a lot of people seem to desire them.

quote:

Originally posted by tacfoley:

quote:

Originally posted by Chris42:
Just came back from a trip to Northern Europe - Denmark, Sweden, Norway, Holland and Germany.

Saw lots of Teslas there, even the occasional Tesla taxi. Appears popular over there.

Tesla are doing well here in yUK, too. I see them every day.

Are the Teslas for Europe manufactured in the US? I'm curious how many plants/production lines Tesla has. Does the EU have unified safety/emission requirements, or are they different for each country?

quote:

Originally posted by DoctorSolo:
Almost every woman I know wants a Tesla. Not every dude, mind you, but damn near every woman I know in her late thirties or older, who drives daily, wants a Tesla of some flavor.

And how many of them can afford one? I don't think this is a good metric to use to measure the potential success or failure of the brand.

quote:

I'm just saying I'm looking around and I see a lot of Teslas zooming around here. And a lot of people seem to desire them.

Yet again, I don't think that's a good metric either to measure the company's health. Here in Central Florida I see them rather infrequently, which also proves virtually nothing.

Dig into Tesla's financials and you'll find some really disturbing aspects of the company. The simple fact that the stock is trading at a price way beyond its real value, coupled with Tesla playing accounting games to show a profit the last two quarters of 2018, is a very good first indicator that trouble is on the horizon. Then add in the plummeting sales volumes for Model S & X vehicles and Tesla missing Model 3 sales volumes in quarter one of 2019 by a lot, while continuing to have a very bad cash and debt financing position, and you begin to see the bigger picture/problems for the brand.

Make no mistake, I'm neither a Tesla fanboy or a hater. i'm just a realist who looks for trends in financial and sales data while continually reading other analysts evaluations of the company.

His business model is convincing government to give his other companies billions of dollars worth of contracts, which he shuffles around behind the scenes to keep Tesla afloat.

Even when he sells a Tesla, he’s in the hole on the car. It costs more to produce than he can sell it for. Tesla has to figure that out. Grants, subsidies, and sycophants is not a stable business model. Eventually you have to turn a Real profit.

Tesla needs $4.00-$5.00 a gallon of gasoline to survive. He has it in Europe due to taxation.

I have talked to several Tesla owners and they ALL love their cars. I never met one that had negative things to say about them. The level of technology in the cars is beyond anything other manufacturers are doing, the number of external cameras as an example. I love performance cars and the internal combustion engine and hate the idea of an all electric future but they even have me looking.