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is tesla going bankrupt?

Will Tesla go bankrupt?


  • Total voters
    78
  • Poll closed .

Tam

Well-Known Member
Nov 25, 2012
11,260
10,290
Visalia, CA
There has been so much talk. Tesla is running out of money. everybody will be left high and dry. the car companies are against it. the inions are against it, the dealers are against it, the government is against it. wall street is against it. The only people for it are the customers. how can it survive?

This kind of thread was already shut down in March:

TESLA Headed for Lack of Cash Again?

But now it is resurrected again.

Tesla used to be a small garage so that question should be appropriate in 2003. But year after year, that same question is repeated over and over again for the past 16 years.

The answer has always been the same, as long as it could get cash to pay its bills, it won't die. That means it doesn't even have to be profitable but as long as it can pay all the bills then it's healthy.

People have been predicting that Tesla should be running out of cash but that's what they've been predicting for the past 16 years.

Instead of running out of cash, Tesla has been building/expanding facilities as well as buying up other companies (Grohmann Engineering, Perbix, Maxwell, DeepScale...)

One quick way to kill Tesla is to cash starve it! Stop supplying cash to Tesla!

If it runs out of cash to pay its bills, and no one re-supplies the cash to it, it would have to liquidate its assets to get cash. And if it keeps liquidating Gigafactory 3, Gigafactory 2, Gigafactory 1... then pretty soon, it'll back to the small size of a garage that it started from!
 
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vickh

Active Member
Dec 16, 2018
3,281
724
az
There has been so much talk. Tesla is running out of money. everybody will be left high and dry. the car companies are against it. the inions are against it, the dealers are against it, the government is against it. wall street is against it. The only people for it are the customers.

that's all you need once they reach critical mass with free cash flow. I believe they have reached it this year with the 3
 
This kind of thread was already shut down in March:

TESLA Headed for Lack of Cash Again?

But now it is resurrected again.

Tesla used to be a small garage so that question should be appropriate in 2003. But year after year, that same question is repeated over and over again for the past 16 years.

The answer has always been the same, as long as it could get cash to pay its bills, it won't die. That means it doesn't even have to be profitable but as long as it can pay all the bills then it's healthy.

People have been predicting that Tesla should be running out of cash but that's what they've been predicting for the past 16 years.

Instead of running out of cash, Tesla has been building/expanding facilities as well as buying up other companies (Grohmann Engineering, Perbix, Maxwell, DeepScale...)

One quick way to kill Tesla is to cash starve it! Stop supplying cash to Tesla!

If it runs out of cash to pay its bills, and no one re-supplies the cash to it, it would have to liquidate its assets to get cash. And if it keeps liquidating Gigafactory 3, Gigafactory 2, Gigafactory 1... then pretty soon, it'll back to the small size of a garage that it started from!
Thank you for the great perspective. JK
 

Tam

Well-Known Member
Nov 25, 2012
11,260
10,290
Visalia, CA
Thank you for the great perspective. JK

You are welcome!

Tesla used to be a private company so its book was not open to the public so it's easy to guess that the reason it didn't open its book was that it's dying since 2003 or 16 years ago.

However, as it has become public in 2010, its book has been public.

So, since 2010 on, it's a tale of Mueller's investigation: people read the same numbers but interpret them all differently.

An example: in the early days when Tesla was unknown and wanted to get an office lease in Detroit. The landlord read the finance sheet and would not approve the lease because he said "You'll run out of money in about 9 months". But Tesla staff chuckled and thought silently that "That's quite generous because we'll run out of cash in just a few weeks, not a few months!"

The risk of Tesla's bankruptcy was high while it was a private company that few would know its name and the public wouldn't know whether it's a real company or not! The public trust and cash pool for Teslas to access at that time were limited: They kept going back to family and friends and the same investors for cash over and over again!

However, as of 2010, Tesla had become public and could access to the almost unlimited cash pool from public investors.

Whenever it needs cash, it has consistently gotten cash from the public through numerous secondary stock offerings, bonds, loans...

If the public thinks that Tesla is going bankrupt, it wouldn't supply cash to Tesla in exchange for stocks, bonds, and loans...

The fact that Tesla has been able to get cash with no difficulties or hesitations from the public means that the company is healthy and the risk of bankruptcy is overwhelmingly small comparing to the prior 2010 Initial Public Offering period.
 
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