redsturgeon
Much as I love Elon Musk and am a great fan of electric vehicles, I can't help but think this is a house of cards just waiting to collapse.
I love him for his innovation and trying something different but I just can't see him ever ramping up production to a significant level to make money on his cars.
I can see VW or BMW being in a much better shape to take things forward.
John
Yes, this is the dilemma for shorts who can not comprehend how institutions they have grown up with can not topple the new boy, by having more capital, established customers, reputations & friendly bankers.
I am now reasonably confident of two things:
First, shorts will not give up, they now have too much on social media & too strong a belief in the old ways to quit. They are set up for either a glorious "I told you so!" or serious losses. That is not a risk reward I ever want.
Second, they have to kill Tesla asap, by what ever methods they can manage. One aspect of the last Tesla call that didn't get much attention was Musk saying that he will not issue more equity, something a lot of shorts would like to allow them to increase short positions. Assuming the US exchanges enforce the naked shorting bans, there is not much stock left to borrow. if Tesla equity rises shorts will not be able to raise their entry position to get their cost base towards the share price & will run into risk management limits, smaller investors will get calls from margin clerks. None of this may happpen, but the way Musk is hinting he is either a good poker player or he has a ace or several aces up his sleeves.
You pays your money & takes your choice.
Either this is a Kodak moment and the established motor makers suddenly find their bonds down graded & their ability to raise capital reduced substantially, or Tesla gets creamed.
Looking at the last set of accounts, the existing reservations (years worth of production) & now the 1000+ reservations for the semi truck, there are two divergent streams. One sure Tesla fails, the other desperate to buy Tesla cars.
Interesting
Regards,