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considering Tesla 3: what if scenario

Discussion in 'Model 3' started by dominikos, Jul 28, 2018.

  1. dominikos

    dominikos Member

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    I hope I won't get flamed for posting this question. I rented Tesla 3 for a day on Turo and loved the experience. Given that I might still qualify for the full tax credit, I started to seriously consider putting an order down.
    While doing research, I came across a post on-line that made a valid observation that if Tesla were not able to turn profit and go bankrupt, stall, or whatever other option you can come up with, the value of the used cars would take a dive.

    I wonder if this is something that folks buying Tesla take into consideration. What would the worst case scenario be?

    Appreciate your thoughts on this!
     
    • Funny x 2
  2. Trevor B

    Trevor B Member

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    Troll alert :rolleyes:
     
    • Disagree x 3
  3. dominikos

    dominikos Member

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    Hehe, Trevor, I'm not a troll. I was worried that this question might be perceived this way. I do really want to understand how people handle this risk in their heads.
     
    • Like x 1
  4. gene

    gene Supporting Member

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    Worst case is Tesla would slow down the advancement of the new models and slow down expansion of factories. Bankrupt? Nope, not going to happen.

    There are greater risks in life that you might worry about. The usual: getting hit by a bus. Having your wife die from cancer (as mine did 4 years ago). If you found a car you love and you want to make a difference for the planet, to be part of the solution rather than part of the problem, the very small risk is worth it. Besides, if Telsa went bankrupt, your Model 3 would be worth even more, not less.
     
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  5. Vinc

    Vinc Member

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    At this point Tesla might be already too big to fail. If things went really south, I could see Apple or another big company just buying them. But going away like Saab or Rover, I doubt it.
     
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  6. abasile

    abasile Conscientious investor

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    I agree with gene that Tesla isn't going bankrupt, as they still have plenty of options for raising capital even in the unlikely event that profitability proves elusive. However, Tesla is a valuable brand, so even in a worst-case bankruptcy scenario, I don't see the company going away. Some other entity would scoop it up.
     
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  7. Thomas Edison

    Thomas Edison Active Member

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    Every auto company in the US except ford (and Tesla) has gone bankrupt... Does it effect the price of a used chevy?
     
  8. commasign

    commasign Tesla Superfan

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    Same argument has been made about Tesla since the original Roadster in 2008. At some point, gotta just ignore the noise and make the leap.
     
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  9. tpham07

    tpham07 Active Member

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    Tesla wont go bankrupt.

    Even if they do, another company will buy the assets. We wont get free supercharging anymore, but whatever.

    Remember amazon.com did not turn a profit for a VERY LONG TIME. New companies spend money growing, so its hard to make a profit. But you can't grow if you don't spend money, so catch 22.
     
    • Like x 1
  10. dhrivnak

    dhrivnak Active Member

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    Personally I was far more worried I would be missing out the car of the century.
     
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  11. insaneoctane

    insaneoctane Active Member

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    The original roadster customers had legitimate concerns like yours .... Model 3 Owners? Not at all.
    My concern level is below the amount of preservatives in soy sauce.
     
    • Like x 1
  12. smalltownguy

    smalltownguy Member

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    Ford is much more likely to go bankrupt. Nearly 10 times the debt as Tesla.

    And that risk is priced into F stock. Multi year low, currently trades at $9.93 per share.
     
    • Informative x 1
  13. Daniel in SD

    Daniel in SD Active Member

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    Not too much concern. If Tesla goes bankrupt it will almost certainly be a restructuring not a liquidation. It can surely be made into a profitable business without all the debt.
     
  14. S'toon

    S'toon Knows where his towel is

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    #14 S'toon, Jul 28, 2018
    Last edited: Jul 28, 2018


     
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  15. electracity

    electracity Active Member

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    1) Inconvenience from your Tesla potentially needing more service than a Toyota.
    2) Finding you don't enjoy a Tesla more than a Toyota.

    That's the worst case. The most likely case is that your will enjoy your model 3 every day. If you really can't afford a Model 3 don't buy it. In 3-5 years EVs will be more affordable. If the price works, and your really want it, buy it. You only live once.

    Tesla is not going bankrupt. Even if they did go bankrupt Tesla is a valuable brand. They would continue under new ownership and your model 3 would still have a warranty.
     
  16. sperkin

    sperkin Member

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    Ford stocks were $1 ten years ago and it didn't go bankrupt. Doubt Tesla will. Also, maybe the US government can still provide ATVM loans to Tesla again which I also doubt Tesla will need. I see at least 20 Model 3s a day. They are like the new Prius in town. After they start making the $35k models, Tesla stocks will be $1k/share. It'll be game over for other other manufacturers in the $30-40k segment.
     
  17. hacer

    hacer Member

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    GM recently did go bankrupt. How did it affect their car's resale value? Even if Tesla were to somehow go bankrupt, they would surely emerge from bankruptcy still making cars, even in the worst case scenario of having new management. It is a silly consideration like worrying if an earthquake is going to wipe out Toyota and what would that do to Toyota resale values.
     
  18. ℬête Noire

    ℬête Noire Active Member

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    tenor-2.gif
     
  19. DaddyD

    DaddyD Member

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    Dominikos, I don't think you are a troll, and I think you are asking a valid question. However I would add one thing to the previous responses - remember that something like $10B in short interest has been bet against this company, which I think is a record. Other carmakers and the fossil fuels industry are probably the reason so much short interest has become focused on this one company - they have a lot to lose. Whatever its origin, the massive short interest is translating into a huge amount of negative press in the scummy underbelly of the financial world, mostly articles by short-sellers trying to line their pockets by driving the stock down being quoted and their misinformation recycled into more shortie hit pieces. Along the way, theories become facts (e.g. in Shortieverse, it is now an accepted reality that Model 3 cancellations are outpacing orders, despite Tesla saying this is wrong). All of them are trying to convince you that Tesla is underwater and the bubbles are rising. A casual observer like yourself could be forgiven for being influenced by all this intensely negative spin. If you see 10 articles a day, and 9 of them say Tesla is doomed, how can that make you feel good about buying the car? But it is noise, and manipulation. It is legal as far as I know, but it is a reason to despise Wall Street, not a reason not to buy a Model 3.
     
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