2016_Z06

it dosnt use all the torque 99% of the time and likely uses it at 200mph+ air cooled?

KGrant

Tesla's unfettered ambition will drain finances: analysts
Supantha Mukherjee

(Reuters) - Tesla Inc (TSLA.O) may have to ask creditors and shareholders for more capital to fund development of an electric semi truck, a new roadster and accelerated production of a high-volume electric sedan, analysts said on Friday.

Tesla Roadster 2 is shown in this undated handout photo, during a presentation in Hawthorne, California, U.S., November 16, 2017. Tesla/Handout via REUTERS

Musk unveiled one flashy strategy for generating cash during the launch event Thursday for the Semi truck, surprising the audience with a prototype of a new generation of the Tesla Roadster. Musk promised the Roadster will be the fastest production car available. The first 1,000 cars will cost $250,000 each, paid in full upfront, with later models starting at $200,000.

Those deposits would put $250 million into Tesla’s cash drawer today for a car that is likely to go into production in 2020.

Musk did not offer details about how Tesla would generate additional funds to deliver the semi truck and the roadster, and overcome production problems that have hobbled production of the company’s high-volume sedan, the Model 3.

Tesla spent $1.1 billion on its auto business in the third quarter, and expects expenses of $1 billion in the current one. It had about $3.5 billion in cash and cash equivalents as of Sept. 30.

At the current cash-burn rate, it would likely be down to about $1 billion in cash by the end of the first quarter.

“In essence, all last night’s event did was add to Elon Musk’s shopping list of things he needs to spend money on at a time when the company is having difficulty making its base vehicle (Model 3),” said Cowen analyst Jeffrey Osborne.

Despite such concerns, Tesla shares were up about 1.4 percent at mid-day. While the shares are up more than 40 percent this year, they have fallen 20 percent from record highs in mid-September.

The Tesla Semi, the company's electric big-rig truck is seen in this undated handout image released on November 16, 2017. Tesla/Handout via REUTERS
Shares in heavy truck diesel engine maker Cummins Inc (CMI.N) fell 4.7 percent, and shares in Class-8 truck makers Paccar Inc (PCAR.O) and Navistar International Corp (NAV.N) also fell.

Tesla this month pushed back its target for volume production on the Model 3 sedan - widely seen as crucial to the company’s long-term future - by about three months to fix production bottlenecks.

Osborne said Tesla’s cumulative capex announcements now exceed $15 billion to $20 billion over the next few years.

Some analysts fear the trucks will be an expensive distraction for the company, which has never posted an annual profit and is in self-described “manufacturing hell” related to the $35,000 Model 3 sedan.

Jefferies analyst Philippe Houchois estimated that Tesla would need to raise $2.5 billion to $3 billion to keep production running smoothly.

“Longer term, we continue to think the capital intensity of the business model will keep returns below best-in-class auto(makers),” Houchois said in a research note.

Tesla’s last debt sale in August was well-received in a hot bond market, allowing the company to increase the offering to $1.8 billion from $1.5 billion. But the bond has underperformed in the secondary market, suggesting it could be more challenging for Tesla to tap the high-yield debt market again so soon.

“They are losing $1.5 billion a quarter and the bond is unsecured so it is not of interest to me,” said Jim Brilliant, chief investment officer at Century Management.

alain1601

Keep it cool and look at facts. What do you drive , a car running on a lot of promises or a production car. I am only saying that it is currently only talk and will be that way as long as there is no tangible demonstrable product, a production car vs a prototype. Otherwise I have respect for what E.Musk is doing to the car industry, with its current product line.

rob62

If money gets tight they can always turn to cocain distribution.

KGrant

Tesla is going to be in trouble when Porsche, Audi, GM, BMW and Mercedes comes out with their competing cars. Tesla long-term won’t be able to sustain itself with low volume cars and the competing cars hits the market for considerably less price.

I commend them for their innovation to date but investors will grow wary of lack of return of their investments into Tesla and the inability to compete long term with the Big Automotive Companies who will leverage scale to produce equal to and/or better EV cars for 20-40% less cost.

The big competition is a big storm on its way for Tesla that it won’t be able to weather.

Ps: The big press conference about a coupe and truck is to try to spurt some new excitement and get new investment money because they are running low on capital and burning through billions without the sales volume to get a Return on Investment.

There is a reason why none of the big automakers will make an attempt to acquire Tesla and their technology and it’s because the experts know Tesla’s business model is not sustainable long term and that they will implode on their own.

range96

All that EMF from the Tesla stops my pacemaker!

JerriVette

I believe tesla will succeed and all the naysayers will just forget they ever said this company is doomed.

I do believe at some point another car maker possibly the Chinese will own a share in tesla.

The product is fabulous and transcends all the so called long standing professionals in this industry.

Acquiring funding will never be a problem for tesla if that's required in the future.

jimmyb

All this high math is beyond me....

What I KNOW is that Elon is a GREAT salesperson!
He is the KING of "Over promise/Under deliver. He has YET to DELIVER ANY vehicle on TIME or even close to it. The Model 3, which was supposed to be up and running well over a year ago (maybe more, I can't remember), is literally trickling out. He has hundreds of thousands of customers waiting on that car. And WAITING is the operative word. The Model X continues to be a problem child with those stupid rear doors...I WANT the guy to be successful, but anyone that thinks this sports car will release in 2020, based on buckets of past promises/broken promises, is crazy. If the car gets to market by 2022, I'll be surprised.

PS. I wonder how the hundreds of thousands of customers, with $1,000 deposits on the Model 3, feel about this latest Elon PR extravaganza. If I'm a person who's waited through countless MISSED deadlines, I think I would want Elon to deliver on the CURRENT promise before moving on to the next GREAT thing.

Why buy at a premium when you can pick the bones for pennies on the dollar a few years from now?

OnPoint

Jimmy,

I'm in your camp on Elon. I actually want him to succeed, and there is no question he has pushed the development of tech.

But his firm isn't going to be around in the form it is now, in the near future. There two very likely scenarios. Either his auto ops get purchased by an existing, profitable major who wants to leverage Elon's tech development. Or Elon's firm gets parceled out in pieces via a bankruptcy court proceeding.

Of course if he does manage to "invent" a way one can keep burning piles of cash far larger than the incoming stream of cash ad infinitum, well, that would be truly historic. But make no mistake he's burning cash. Great big mountains of it. Month after month. And the laws of finance and economics haven't been beat yet by anybody, and I don't think he'll beat them either.

HPT

You live in Kansas. Your opinion of Tesla means nothing.

jimmyb

Sadly, it's not an opinion thing. It's an economics thing. If you spend more than you bring in, you're in trouble. Elon's been doing that for some time now. Plus, He's holding $350 MILLION in deposits from CUSTOMERS, waiting on the Model 3....
He keeps speaking of "production hell", I hope it is logistics and not money set aside for car parts that went somewhere else....
I want him to succeed but somewhere, some time, Tesla has to start acting like a REAL business.

OnPoint

SpryGeezer

Musk's Tesla Roadster has four seats, A(4)WD and is faster than a speeding bullet. I'd swap my '96 Impreza for one in a Palo Alto minute which is much-much shorter than a New York minute.

johnglenntwo

http://www.telegraph.co.uk/technolog...rk-washington/

"You big shots need to be thinking Lambo, really!"

Diversified and Too BIG to fail!

pokerpro

Not to worry our Government will bail them out!

CORVETTEZL1001

They keep taking deposits........

NytmereZ

The “Let’s so it on a track” quote is getting real old, let’s face it... 98% of people who say that(probably more) are never going to see a track.
That being said i would never take a Tesla over a vette.

OH THREE Z

A 50 grand deposit or 250 grand for a "founders edition" from a company that is in financial trouble and that has little chance of being delivered on time...

Ol' John Z should have thought of this instead of doing that pesky coke deal

sunsalem

A) Tesla is not in "financial trouble."
B) This will be a low production vehicle and ONLY Tesla knows when deliveries will take place.
AFAIK, deliveries on the Model 3 began when they said they would, albeit not in the great numbers everyone had hoped for.

zrracer

i have made good money on Tesla stock over the years so I can help pay the gm bailout.
Gm has tried for years to do a successful electric car. Tesla has a waiting list.
I just hope we don’t have to bail GM out again. With Chrysler now being a foreign company and Ford not needing the bailout we are down to gm failing again. Gm will never be as large as it was. All the other dealers filled in where Gm left. They again are in the position that they need to compete and stay with their competition to survive.
I love my vets but...... as soon as Tesla sets up more charging stations or the ability to go a little farther I am in. I have been in one and driven one. The Tech is great. The car is well done and it’s quick.