Chevy Volt a Failure - GM to Layoff 1,300

Elon Musk appears to smoke marijuana during an interview

Alrighty, then.

 

Tesla's Chief Accounting Officer just resigned. ... a month after he was hired. Stock down another 5.5 percent at the moment, premarket. The number of high level resignations over the last 3 years is staggering. As I posted before, Jim Chanos says that is the most reliable indicator of fraud he has in his bag of tools.

 

A lot of people really loved the missions of his companies. That is where you were coming from. Early on on this thread (and this has nothing to do with you), my posts were pretty much of the variety of, "EVs have been around forever. The batteries are super expensive and limited in range. With gas at the price it is, it's hard to produce something that is going to make economic and practical sense for anyone." And the responses I got from some people were almost evangelical. Not rooted in reason.

They have increased the ranges on the batteries. But it drives up the cost of the cars even more. Which is why even with all of the subsidization, he is losing money on every car he sells. And these are pretty expensive cars -- typical Model S is in the 70K to $100K range. And he is losing money -- without billions of dollars of borrowed cash to spend, he'd have been out of business long ago.

I always said maybe that will change. But I thought it just as likely that by our government giving preference to a handpicked technology (in what was a pay to play crony capitalism thing), it was likely diverting capital from potentially more viable things. I hated that it was happening. Don't forget, Tesla is still around. But you had Fisker getting a big "loan" that we all ate. And several other green technology companies. It's in the dustbin of history and people move on esaily.

Where we are now? I'd say it is better than even odds that the SEC finds fraud in the sales and financials. But even if they don't, and there is no fraud (other than Musk's pump the stock and squeeze the shorts tweets -- to keep the stock price inflated because it has been the thing he has leveraged to raise more and more money, and he may personally be leveraged in his lifestyle to the stock price), the company still hasn't come up with anything that demonstrates it can be profitable. The only thing it has ever actually sold for actual income are ZEV credits that the State of California forces other car makers to buy from them. Ohterwise, it blows through other people's money at a staggering rate.

The reason I started calling him PT Barnum (and a few people were laughing at me) years ago on this thread was that I saw a pattern. Nothing added up financially, he kept hitting the capital markets, which had been destroyed by the Federal Reserve so money was flowing to ridiculous places. Then, he'd made grand promises, never delivere and then would try to distract with even grander promises. See that a few times, and it raises warning signals. And all the while, I was tracking how much cash he was burning through, and I have never seen anything like it in a public company.

But with the hype machine stories which were relentless for a few years, and the ratings the Wall Street Bubble apparatus were dishonestly feeding everyone, I can understand how I came off earlier on on this thread. It must have seemed very contrarian. ... until it wasn't.

I said all along it was the biggest no brainer short there was. I never shorted it. I knew with the cult status and how big the float has been, the short squeezes could be epic and last a long time. I probably would have started shorting it at around $70 a share (when I started really looking at it). I am glad I sat on my hands. I am not Andrew Left (who announced he is suing Musk today). I don't have the kind of money it takes to withstand that kind of pain.

 

Gene Munster: If Tesla doesn't overhaul the board right now, it could spell the end for the company

To truly appreciate this , you need to know who Gene Munster is. He was a sell-side Wall Street analyst @ Piper Jaffrey who used to appear on TV a lot hyping every darling tech stock getting run up into bubble territory with crap projections. He was the "buy, buy, buy!!!" "revolutionizing the world," "No need to look at valuation, this is going to be bigger than the Lindy Hop " guy. At least that was always my perception. Like on the Model 3, Musk would put out bullshit that $35,000 EV Model 3s , were going to be hit the market in a year with all kinds of cool features like autonomous driving (and btw, they have been aggressively contacting the people who put down a $1,000 deposit a few years ago waiting for a $35,000 car. ...trying to get them to clear a full lot of $55,000 cars that has piled up).

An Andrew Left would be pouring through the numbers; how that was possible given the costs how much they lose on their Model S, the years of bullshit promises from Musk, his inability to meet any aggressive deadline he has ever set, etc. Munster would just take it as gospel and hit the interview circuit doing, "Oh boy! This is a game changer. That is cheaper than a Camry. 5 years from now there aren't going to be any other car makers except Tesla! Buy, buy buy!" (only slight exaggeration on the made up quote).

I believe he is now doing venture capital work. He still gets his mug on Bloomberg, CNBC, etc. all the time talking about Apple and Tesla.

For HIM to be writing this, including calling Elon Musk's "aura," "part jerk, part bully and part liar,' is wild beyond belief.

 

If anyone is interested, NIO, the Chinese electric car maker that has a decent vehicle that costs half of a Model S in China, has an IPO listed on the New York Stock Exchange today. The offering brought them about a billion dollars, which is a lot of money, but to show how the hype is slowly disappearing, when they first floated going public, they were looking for more like $2.5 billion.