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Musk endeavours

The Big Picture Place
Howard
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Re: Musk endeavours

#217103

Postby Howard » April 24th, 2019, 9:17 pm

odysseus2000 wrote:
Germany legacy auto is in terrible trouble. They have no answer to robotic driving, they can't even make a car that out performs the model S of 5 years ago and the electric cars they are turning out are 3rd rate Frankenstein models and they can't get these out because they can't source batteries. One has to believe that all the legacy motor announcements of coming new battery cars are all about the media and nothing about the engineering as they can't make what they have now and seem unlikely to make the sophisticated new models they are talking about in the time scales they advertise.

If robotic cars work the cash flow to Tesla makes the current valuation look like a very serious under-pricing.

Competitors better catch Tesla now, if they leave it a few more years they will be about as competitive as horse breeders in 1910.

Regards,


I don't want to go too far off topic but I have been reading the Half Year report for AB Dynamics which produces driver-less robots used in the testing of Advanced Driver Assistance Systems for Toyota, GM, Ford, Mercedes and some other major manufacturers.

They are an example of a well-run company in this growth area of auto manufacturing. I was lucky to buy their shares around £2 around four years ago and they are now just under £20, so have done a little better for their investors than Tesla. Possibly now is not the time to invest in them as they are quite expensive because they have managed their growth so successfully.

But, on the eve of Tesla's progress report, it might be worth looking for some other key suppliers to Tesla or their competitors? There is the old example of the success of the makers of picks and shovels during the US gold rush. Much better to invest in a few suppliers than risk the roller coaster ride of Tesla shares?

regards

Howard

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Re: Musk endeavours

#217114

Postby odysseus2000 » April 24th, 2019, 10:12 pm

Howard wrote:
odysseus2000 wrote:
Germany legacy auto is in terrible trouble. They have no answer to robotic driving, they can't even make a car that out performs the model S of 5 years ago and the electric cars they are turning out are 3rd rate Frankenstein models and they can't get these out because they can't source batteries. One has to believe that all the legacy motor announcements of coming new battery cars are all about the media and nothing about the engineering as they can't make what they have now and seem unlikely to make the sophisticated new models they are talking about in the time scales they advertise.

If robotic cars work the cash flow to Tesla makes the current valuation look like a very serious under-pricing.

Competitors better catch Tesla now, if they leave it a few more years they will be about as competitive as horse breeders in 1910.

Regards,


I don't want to go too far off topic but I have been reading the Half Year report for AB Dynamics which produces driver-less robots used in the testing of Advanced Driver Assistance Systems for Toyota, GM, Ford, Mercedes and some other major manufacturers.

They are an example of a well-run company in this growth area of auto manufacturing. I was lucky to buy their shares around £2 around four years ago and they are now just under £20, so have done a little better for their investors than Tesla. Possibly now is not the time to invest in them as they are quite expensive because they have managed their growth so successfully.

But, on the eve of Tesla's progress report, it might be worth looking for some other key suppliers to Tesla or their competitors? There is the old example of the success of the makers of picks and shovels during the US gold rush. Much better to invest in a few suppliers than risk the roller coaster ride of Tesla shares?

regards

Howard


i had this idea with Apple and when I found a video that took one of their iPhones apart I noted down all the manufactures involved and then looked at their equity performance.

I had expected to discover a gem but instead I found that very few of the component suppliers had equity price appreciation close to Apples.

Thinking about the situation, most of the supplier were in the commodity space, supplying components that they could not get high margins on because others could make competing products.

In terms of Apple the recent break out of friendship with Qcom might make for a good investment opportunity in Qcom as Apple have now signed long term supply agreements to use their communication chips having had to use those from competitors when they were at war. But if I could only have one I would still pick Apple as they have the margin power.

Tesla are very similar to Apple in many ways and the robotaxi operation over a Tesla network will, if it works, be very lucrative like the iPhone is for Apple.

Regards,

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Re: Musk endeavours

#217116

Postby odysseus2000 » April 24th, 2019, 10:16 pm

redsturgeon wrote:This could be a serious issue back down the line at the Gigafactory.

https://www.businessinsider.com/panason ... ?r=US&IR=T

John


This factory bugs me.

Panasonic came out and complained about Tesla not buying enough batteries. Musk shot back saying that Panasonic were not making enough batteries.

Folk tended to believe Panasonic and dismiss Musk, but this is just one of a few articles I have seen which tend to support Musk's view.

From a Tesla perspective the sorts of abuses detailed are a great worry as having Tesla cars fail due to battery manufacturing issues would be very like how bad hard drives from Western Digital and Seagate destroyed Amstrad computers.

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Re: Musk endeavours

#217126

Postby odysseus2000 » April 24th, 2019, 11:49 pm

Just listened to the latest Tesla conference call which was a steady as she goes affair from Tesla executives.

The decline in sales were put down to their inability to ship product, with much of the delivery taking place in the last 10 days of the quarter.

One new piece of info was that Tesla are to launch an insurance for Tesla owners. This again is following the Apple service model of expanding their product line to include services. Apple were slated by many analysts for going so heavily into services but where ever I go I see Apple-Pay and their web service although low cost compared to buying an iPhone is nonetheless a nice money spinner. Insurance has not hurt Warren Buffett and I suspect it will not hurt Tesla.

The upgraded S, announced a few days ago, with a range of 370 miles has been driven from Frisco to LA at highway speeds without needing to re-charge due to various improvements to its drive and power train.

Roof tile solar panels, version 3, is now apparently better refined and likely to have a warranty of 20 to 25 years with a service life of circa 30 years. Recently I was traveling for train and I was quite distressed at all the new build with ugly solar panels, compared to what one could have with solar roof tiles which I believe would be much easier to install too. Although many hate the solar city acquisition I still think it has huge potential along with storage and this has the advantage that the requirements on the batteries are not as severe and these may be sourced from all over the world.

Whether the conference call was all chaff designed to distract investors from imminent bankruptcy as many in the Twitter sphere routinely tweet about or the steady growth of an emerging huge business will likely not be known in 2019, but if the earnings call is reliable as I believe and if self driving does happen then I remain very bullish and the more negative stuff I see the better I like it, especially when a lot of the technicalities of bear arguments I know to be wrong.

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Re: Musk endeavours

#217149

Postby dspp » April 25th, 2019, 8:24 am

https://ir.tesla.com/investor-relations

https://ir.tesla.com/static-files/b2218 ... 0eb29dd42f = Q1 update letter

GAAP operating loss of $522M, GAAP net loss of $702M, including $188M of non-recurring charges

 Cash and cash equivalents of $2.2B at Q1-end
 Model 3 gross margin ~20% in Q1
 Revealed Tesla Model Y
 Started production of Full Self Driving computer

We ended the quarter with $2.2 billion of cash and cash equivalents, a $1.5 billion reduction from the end of 2018. This reduction was driven by a $920 million convertible bond repayment and an increase in the number of vehicles in transit to customers at the end of Q1. In addition, we began production and deliveries of Model 3 vehicles for overseas markets. As noted in our Q1 2019 Vehicle Production & Deliveries letter, due to unforeseen challenges we had only delivered half of the quarter’s numbers ten days before the end of the quarter. This caused a large number of vehicle deliveries to shift into Q2.

In Q1, we experienced non-recurring items that negatively impacted our net loss by $188 million. As a result of Q1 pricing actions taken on Model S and Model X, we incurred net $121 million loss for increases in the assumed forecasted return rates for cars sold under our Residual Value Guarantee and Buy Back Guarantee programs, as well as inventory write downs for used and service loaner inventory. We also incurred $67 million due to a combination of restructuring and other non-recurring charges.


"If our Gigafactory Shanghai is able to reach volume production early in Q4 this year, we may be able to produce as many as 500,000 vehicles globally in 2019"

I hold, dspp

ps. ody, sorry but you are wrong on how easy it is to install solar. Give me modules any day over tiles. Tiles are a liability disaster waiting to happen, and long before that they will be a production & sales disaster, and for now they are a R&D disaster.

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Re: Musk endeavours

#217150

Postby Archtronics » April 25th, 2019, 8:29 am

Having to replacing your roof every 30 years is just ridiculous and costly.

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Re: Musk endeavours

#217168

Postby odysseus2000 » April 25th, 2019, 9:43 am

I may be completely wrong on roof top solar, so happy to be corrected. My thinking goes along these lines.

The advantage of converting ones roof to solar are financially significant, a neighbour had a return of purchase price in 5 years with a 20 year contract & if electric cars become common I expect solar & storage to become standard additions to most of the uk building stock. Aldi supermarkets clad all the stores I have seen with solar but so far not many others do, but I expect that to change

In terms of other electrical goods, a 30 year life time is a lot more than one expects for say a fridge, boiler...One of the houses near where my business partner lives has just had a new roof after initial build in the 1960's, costing a few grand & done in around a day. Other folk tell me that tile roofs like this have a finite lifetime measured in several decades whereas Welsh slate has life times of multi centuries for the slates, but they too suffer from the sagging or rot of battens etc and need maintenance every few decades.

Last week I was traveling by lots of new build, over half had roof top solar, most of the bolt on type that is very common all over the country, but with maybe 15% having the solar panels sunk into the roof so as to be level with the existing roof. These roofs do not look as pretty as a tile or slate roof & presumably have trouble in conservation areas.

The bolt on panels seem to be remarkably robust. I have never seen one blown off and are presumably relatively cheap to replace. So the case for solar tiles would be aesthetics & being able to get more capacity with out the constraints of bolt on solar panel size and then one would have to focus on the cost & reliability.

From my ignorant stand point it would seem that one system of roof & power would be better than two systems of roof & solar & a 30 year life time would be similar to the 30 year insurance backed warranties offered on new homes.

So why is tile solar not liked? Is it the difficulty of connecting the tiles or some other aspect that I have failed to identify?

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Re: Musk endeavours

#217174

Postby Archtronics » April 25th, 2019, 10:13 am

Seems simple to me in the UK anyway it's expensive and more work to install, with that in mind the potential customers are limited.
Its the exact same reason why composite tiling systems are more popular than the nicer looking and superior slate roof.

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Re: Musk endeavours

#217177

Postby dspp » April 25th, 2019, 10:26 am

odysseus2000 wrote:I may be completely wrong on roof top solar, so happy to be corrected. My thinking goes along these lines.

The advantage of converting ones roof to solar are financially significant, a neighbour had a return of purchase price in 5 years with a 20 year contract & if electric cars become common I expect solar & storage to become standard additions to most of the uk building stock. Aldi supermarkets clad all the stores I have seen with solar but so far not many others do, but I expect that to change

In terms of other electrical goods, a 30 year life time is a lot more than one expects for say a fridge, boiler...One of the houses near where my business partner lives has just had a new roof after initial build in the 1960's, costing a few grand & done in around a day. Other folk tell me that tile roofs like this have a finite lifetime measured in several decades whereas Welsh slate has life times of multi centuries for the slates, but they too suffer from the sagging or rot of battens etc and need maintenance every few decades.

Last week I was traveling by lots of new build, over half had roof top solar, most of the bolt on type that is very common all over the country, but with maybe 15% having the solar panels sunk into the roof so as to be level with the existing roof. These roofs do not look as pretty as a tile or slate roof & presumably have trouble in conservation areas.

The bolt on panels seem to be remarkably robust. I have never seen one blown off and are presumably relatively cheap to replace. So the case for solar tiles would be aesthetics & being able to get more capacity with out the constraints of bolt on solar panel size and then one would have to focus on the cost & reliability.

From my ignorant stand point it would seem that one system of roof & power would be better than two systems of roof & solar & a 30 year life time would be similar to the 30 year insurance backed warranties offered on new homes.

So why is tile solar not liked? Is it the difficulty of connecting the tiles or some other aspect that I have failed to identify?

Regards,


Ody,

Your post contains quite a lot of ignorance. So much so that it is difficult to know where to start. I'll try ....

Concrete roof tiles have a lifetime of the order of a century. Slate was on my roof for about a century and I am seeing no degradation in my concrete after 20-years and am fully expecting another 80-years out of them. Really the limiting factor for both is the underpinnings. In contrast PV modules are likely to have lifetimes of the order of 25-years or so, mostly driven by module edge delamination or storm damage. So it makes no sense to put a roof on that needs mostly replacing every 25-years. Better to split the two functions, which is what the normal PV module above a roof does. Then consider the replaceability of a single module (is the right size still available) in the event of damage versus that of a roof tile. If you function share the roof tile to become a solar tile then you multiply these replace & repair problems a thousand fold.

The next issue is that solar modules behave best when cold. Putting their back side into a hot roof space is a real no-no. The only reason it is done is because the NIMBY brigade anti CC brigade and anti renewables brigade use aesthetics as a way of blocking any solar PV in their area. The work around is to set the PV flush with the roof, which in practice means it has to become the weather proofing of a roof. So the heating loss is accepted as the alternative is nothing. This in turn causes all sorts of fire risk issues which have caused endless grief to people like me who write & sign off the standards, because there is a burn-through time spec that the roofing system has to meet so as to alllow time for a fire brigade to clear a building before the roof turns into a chimney. If in any doubt of how hot a potato this can be go and look at Grenfell. Oh and did I mention that the weather proofing itself can be an issue.

Then you get to the connections problem. The best connection is the one that isn't there. This is a manufacturing cost issue, a installation cost issue, and a reliability & safety issue. So the largest possible module creates the fewest possible connections per roof. In contrast a solar tile roof probably creates about a hundred times a many connections as a PV module system.

Then you get the installability issues. I don't know about you, but when I put tiles on roofs I put an angle grinder through quite a lot of them. Try doing that with your expensive delaminating solar tile. Or are you going to have a mixed roof. Did I mention that they are different trades on a roof by the way.

Then I get to the performance issue. You want the minimum edges (loss) to the maximum producing space. So the big module wins hands down over the small tile every time.

The only other reason that the building integrated PV systems (BIPV) exist is because the manufacturers conned the politicians into giving them an uplift in the tariff in a number of jurisdictions. That was partly because they wanted compensating for the INCREASED COST of installing a BIPV system, and partly because they wanted to push their consumers into buying these systems. It was the French wotdid it because there was a few (mostly) French factories that were making this stuff back in the day. I used to distribute this (for a non-building application) at the time and so got quite aware of the behind-the-scenes manoeuvring that was going on. I am afraid the £$$%^&-fest continues, although it does change shape a bit.

I'm sure there were other reasons, but this is enough. Really this aspect of the Tesla business should have a stake put through it.

regards, dspp

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Re: Musk endeavours

#217192

Postby odysseus2000 » April 25th, 2019, 11:13 am

Hi dspp,

Thank you, super useful information.

The practical issues you highlight clearly show that for roof tile solar to be any good it will have very large hurdles to jump which may not be possible.

It will be interesting to see what Musk's engineers comes up with, but these kinds of issues probably require a complete re-engineering of the whole roof idea thats that have been practiced for many centuries & may not be possible. Going from something like slate that is relatively light weight, very resistant to weather, does not spark when struck, inflammable... has been done with the fried earth roof tile on many houses, that has noted are much faster to fit than slate requiring none of the slate nails that make mending slate roofs so difficult & expensive, but going further may not be practical.

Even Brunel had his failures so this may be one of Tesla's although of course if it can be done at a competitive cost with it would be something valuable.

Regards & thanks,

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Re: Musk endeavours

#217257

Postby BobbyD » April 25th, 2019, 2:25 pm

odysseus2000 wrote:Panasonic came out and complained about Tesla not buying enough batteries. Musk shot back saying that Panasonic were not making enough batteries.


It's quite possible for demand to be low and that Pana are failing to fulfil it. Either way its not good news for Tesla.

dspp wrote:https://ir.tesla.com/investor-relations

https://ir.tesla.com/static-files/b2218 ... 0eb29dd42f = Q1 update letter

[i] GAAP operating loss of $522M, GAAP net loss of $702M, including $188M of non-recurring charges

 Cash and cash equivalents of $2.2B at Q1-end


I'm guessing most people will agree this isn't good. Any thoughts on how not good?

dspp wrote:ps. ody, sorry but you are wrong on how easy it is to install solar. Give me modules any day over tiles. Tiles are a liability disaster waiting to happen, and long before that they will be a production & sales disaster, and for now they are a R&D disaster.


Is there a reason we still use traditionally sized roof tiles? I would imagine that larger units would be trickier to fit, but would they be proportionately trickier to fit given a new build with a roofing system designed to accept significantly bigger tiles? I'm assuming we came across the rough standard as a result of manufacture, transportation and fitting restrictions which existed somewhere north a hundred years ago? Are they still valid constraints?

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Re: Musk endeavours

#217267

Postby dspp » April 25th, 2019, 2:59 pm

BD and 02,

To a certain extent we are moving away from roofing tiles, but not really in domestic construction. Large buildings are almost entirely clad in large sheets these days, increasingly SIPS. The reason that longer lifed domestic one or two family dwelling stuff will mostly stay with roofing tiles is due to the wide variety of roof layouts, plus through-life maintenance.

It is possible that Tesla may be the company to crack solar tiles. But right now I think they have better areas to focus their capital on. Tesla storage is fine, Tesla solar can (and are) use COTS modules. But if Tesla automotive fails due to lack of cash then it is game over. So as far as I am concerned negligible effort should be going into solar tiles unless it is a Fed-backed effort.

The actual solar technology in the tiles is one of the thin film products. The underlying rationale why Musk is interested in this is because you can roll up a big reel of this (without its backing materials) and take it to another planet. Right now that should not be a problem that concerns Tesla capital employed.

regards, dspp

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Re: Musk endeavours

#217276

Postby BobbyD » April 25th, 2019, 3:41 pm

dspp wrote:To a certain extent we are moving away from roofing tiles, but not really in domestic construction. Large buildings are almost entirely clad in large sheets these days, increasingly SIPS. The reason that longer lifed domestic one or two family dwelling stuff will mostly stay with roofing tiles is due to the wide variety of roof layouts, plus through-life maintenance.


So ignoring existing housing stock for now, a simple change to the building regs for new homes could mean we are at peak tile and entering an age of large easy to swap out modules for domestic roofing? Now those sound like the sort of thing you might want to incorporate solar in to, rather than fiddly little, labour intensive tiles.

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Re: Musk endeavours

#217279

Postby PeterGray » April 25th, 2019, 3:51 pm

I think dspp's reasoning on roof tiles is hard to argue with, I can't see much future in that approach.

However, with moves, more in some countries that others, towards factory built, assemble on site houses, it's not hard to see premade roof panels, made to fit for a specific situation, becoming available for newbuild.

That answers a lot of the issues, but not the longevity one. I can't see a roofing product with a lifetime of less than 50 years, or longer, being seen as acceptable. At present it's hard to see a solar technology that had that sort of lifetime appearing, electrics and electronics just don't in general, particularly when exposed to the elements and in full sunlight. Perhaps some sort of weatherproof, made to measure base panel, with replaceable bolt on panel or panels on top, that could be replaced as required could be a solution?

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Re: Musk endeavours

#217290

Postby BobbyD » April 25th, 2019, 4:33 pm

PeterGray wrote:That answers a lot of the issues, but not the longevity one. I can't see a roofing product with a lifetime of less than 50 years, or longer, being seen as acceptable. At present it's hard to see a solar technology that had that sort of lifetime appearing, electrics and electronics just don't in general, particularly when exposed to the elements and in full sunlight. Perhaps some sort of weatherproof, made to measure base panel, with replaceable bolt on panel or panels on top, that could be replaced as required could be a solution?


I must admit my major motivation is aesthetic ...bolt on panels are ugly as hell, houses should look nice.

A modular system with a built in solar panel retention mechansim would certainly be one option, but surely longevity becomes far less important when your roof is earning you money, and replacement of an average 2 up 2 down's roof involves swapping out 6-8 panels,and the need to replace only applies to those sides to the roof with solar, which would have a 100% solar surface area increasing generating potential.

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Re: Musk endeavours

#217299

Postby dspp » April 25th, 2019, 4:55 pm

My house looks prettier with modules on than without. Black on black can be pretty minimalistic and not at all in your face.

Two of the companies pursuing 'carpeting' solar onto large roofing sheets were unisolar and flexcell. The aim was to print the stuff and bond it onto 8' x 4' or larger roofing sheets. Buildings with roofs like that typically have 40-50 yr design lives. If sheets fail early in these scenarios the concept was to shrug. Who cares!

This line of attack failed for a great many reasons. The underlying technology then got adopted by the solar roof tile brigade. It is an even worse idea when coupled with small tile sized modules that are on buildings with a greater design life, and greaterbuild cost.

Must go plane boarding fspp

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Re: Musk endeavours

#217373

Postby odysseus2000 » April 26th, 2019, 12:03 am

Mildly interesting CNBC video:

https://twitter.com/CNBC/status/1121529566336442369

In some ways it is somehow surreal that there is such a huge divergence of opinion on Tesla.

However, from an historical perspective one expects that anyone who does things will polarise educated opinion. Going back to the start of the industrial revolution Arkwright was both loved and loathed and this pattern has repeated through e.g. Brunel, Edision, Ford, Jobs, Bezos... All of them greatly polarised those with the experience and qualifications to make informed decisions as well as those who have not the education and or experience.

This kind of polarisation extends to most celebrities. Anyone who becomes well known and successful gets folk who love and respect them and at the same time gets folk who hate and disrespect them.

In the by and by everyone fails in some way or another either by bad business decisions, bad character decisions or by the human ageing process and decline. As Enoch Powell, put it: All political career ends in failure.

One might think that one ought to celebrate the good things that folk do and in some ways the honours systems that most nations have do celebrate this, but for the folk that hate and loathe them, the receiving of any honour or any success adds to their loathing. I find it quite fascinating, a clear example of how emotions dictate how folk think and as with any emotionally held belief it is not something that one can change by any logical argument, such that any debate is pointless. It mostly comes down to the votes in terms of how much and how many will pay for what the person does or how many retain a love for the individual when there is no monetary reward.

There is also a polarisation in that some fraction of the population tend to admire individuals while others tend to dislike individuals getting their greatest delight when some high flying individual crashes. Fascinating to me how this all works and how folk who reach enough seniority can transcend all the rules and sanctions applied to less successful individuals and historically have in many cases done bad things and escaped any justice, the folk they have hurt not being able to get help from the authorities, often being dismissed as nutters such as happened with all the celebrity abuse scandals.

As investors one has the final logical decider of profit and loss which over time tells you if an individual or business has been successful in a logical none emotional way. Equity markets are endlessly making these calls while they are open, but although such decisions and volatility can be profitably exploited by day trading, big money is often made by swings over years. Whether Musk become a legend like Jobs or a disgraced individual like George Hudson the once Railway King is far from clear and won't be for some time to come.

Regards,

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Re: Musk endeavours

#217375

Postby odysseus2000 » April 26th, 2019, 12:15 am

Bears will like this:

https://twitter.com/i/status/1121446015716847617

then again this is Cramer on lyft ipo:

https://www.cnbc.com/2019/03/28/cramer- ... arket.html

For the record lyft opened near $90 and has now fallen to around $56.

But then again Cramer is just a simulation according to Musk

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Re: Musk endeavours

#217475

Postby odysseus2000 » April 26th, 2019, 12:34 pm

Tesla bonds trading as junk with a very high yield:

https://uk.reuters.com/article/us-tesla ... KKCN1S11J5

I rarely mess with bonds and have no interest in these, although if things do turn around they will do well, but could be a complete loss if things don't improve.

If they do need to raise capital then it will be expensive and this may force them into an equity dilutive arrangement rather than bonds should sales continue to be low and the need for cash to rise.

An alternative would be some cash injection from SpaceX into Tesla.

Clearly now they need to sell cars against a hard and growing wall of social media set up to trash their product.

Last time I heard any mention of a right hand drive model for the UK, Japan etc it was mid 2019. The appearance or none appearance of a right hand drive car would be some kind of indication of what the reality is at Tesla

It will be interesting to see what Tesla does in the next few weeks and months and whether the losses just reported were all about kitchen sinking or about the impossibility of creative financial engineering to make them look better.

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Re: Musk endeavours

#217490

Postby PeterGray » April 26th, 2019, 1:36 pm

An alternative would be some cash injection from SpaceX into Tesla

Surely that's not likely? They were reporting a loss in Nov, and looking to raise $750m debt. I can't see SpaceX having spare cash lying around.


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