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Long-Term Fundamentals of Tesla Motors (TSLA)
- Thread starter Robert.Boston
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- elon is an ass investing TSLA
Seems like Tesla makes a strong case:
NUMMI was built in 1984. Lead paint was first banned by congress in 1971 with CPSC banning it in 1978.
from EPA:
- In 1973, EPA banned spray-applied surfacing asbestos-containing material for fireproofing/insulating purposes. See National Emission Standards for Hazardous Air Pollutants (NESHAP) at 40 CFR Part 61, Subpart M
- In 1975, EPA banned installation of asbestos pipe insulation and asbestos block insulation on facility components, such as boilers and hot water tanks, if the materials are either pre-formed (molded) and friable or wet-applied and friable after drying. See National Emission Standards for Hazardous Air Pollutants (NESHAP) at 40 CFR Part 61, Subpart M
- In 1978, EPA banned spray-applied surfacing materials for purposes not already banned. See National Emission Standards for Hazardous Air Pollutants (NESHAP) at 40 CFR Part 61, Subpart M
- In 1977, the Consumer Product Safety Commission (CPSC) banned the use of asbestos in artificial fireplace embers and wall patching compounds. (See 16 CFR Part 1305 and 16 CFR 1304)
- In 1989, the EPA issued a final rule under Section 6 of Toxic Substances Control Act (TSCA) banning most asbestos-containing products. However, in 1991, this rule was vacated and remanded by the Fifth Circuit Court of Appeals. As a result, most of the original ban on the manufacture, importation, processing, or distribution in commerce for the majority of the asbestos-containing products originally covered in the 1989 final rule was overturned.
Do you understand indemnities, CERCLA and strict liability? Perhaps Mr. Maron did not encounter those concepts in Family Law courts.
Waiting4M3
Active Member
Why are we talking about $500K in the Long Term Fundamentals thread? This is completely irrelevant.
Because, fundamentally, lead and asbestos never go away?
The NUMMI project was started in 1984, but the Fremont plant was built in 1961. GM closed it in 1982 and it re-opened as NUMMI in 1984. Lead was used in car paint before 1978 and asbestos was still used as insulation in 1961. As they remodeled and expanded the plant for the Model 3, they probably ran into some asbestos issues. There may be some lead paint dust around the factory, but the paint shop probably dealt with most of the lead when they remodeled the plant for the Model S.
In the response to the lawsuit, Tesla said they didn't authorize all the work that company did. They may have found asbestos in some walls or ceilings Tesla was not planning on disturbing and removed it without Tesla's authorization. $500K is a lot of money to a small company, but it is peanuts at the scale Tesla is operating.
First, it's in today's market news feeds. (If you think it's posted in the wrong thread, ask the moderators to move (or even remove it)).
Second, whether valid or not, it reinforces the narrative that Tesla is strapped for cash and needs new capital. (Seriously, why couldn't Tesla's contract administration personnel find a reasonable way to compromise, before it got to litigation, what looks like a run-of-the mill change order for less than 15% of a contract, which by nature has a scope difficult to define precisely before field work begins?) Tesla's/Elon's litigation/arbitration track record is dismal, viz controversies with:
- Eberhard and Tarpenning about Tesla's founding
- BorgWarner about Roadster gear boxes
- Fisker about car designs.
- Top Gear about Roadster performance
- Hoerbiger about Model X door closing mechanisms
- IRS about solar system valuations
- Anderson about Autopilot technology theft,
- Etc.
Third, it's in the Long Term Fundamentals thread because it has potential long term implications to TSLA's financial well-being. As an Owner of the Fremont site, Tesla is strictly liable for any harm to any individual who comes on the property caused by exposure to any un-natural substance deposited on the property or any emissions of such substances from the property that contaminate the atmosphere or adjacent properties. Tesla's innocence or negligence is irrelevant. Tesla has a right of reimbursement from prior owners in the title chain, but "old" GM is insolvent and Tesla indemnified Toyota as part of the NUMMI acquisition agreement.
Fourth, the Workers' Compensation statutory limitation on injury claims from employees allegedly arising from un-healthy workplace exposures is readily circumvented by their lawyers simply suing Toyota-- because of the indemnity, Tesla has to pay Toyota's defense costs and any damages assessed. (Tesla "self insures" it's Product Liability exposure--which presents a whole different can of worms with respect to Autopilot deaths/injuries regardless of the caveats in the Owner's Manuals--any idea of Tesla's General Liability Insurance limits?)
Fifth, what do the ABL creditors do, if one of the plaintiffs' sharks in the environmental litigation bar were to obtain a verdict and tries to enforce an Abstract of Judgment against the Fremont factory?
You want to denigrate anyone who posts any thing about potential problems? Fine. I think you are oblivious to the risks inherent in how you have invested your capital.
Waiting4M3
Active Member
Exaggerate much?
P.S. I'm only responding to your misrepresentation of my reply. I won't engage in the rest of your arguments as I maintain those are not relevant to long term discussion.
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What BorgWarner Roadster gear box dispute? They had a problem with the 1.0 transmission that Tesla took responsibility for. Then they hired BorgWarner to design and build the replacement 1.5 gearbox. They never had any problems with that. What was the dispute you're referring to?
sundaymorning
Active Member
Elon will fight everyone from the little guy to the big boys (oil companies) if they F with his babies, SpaceX/Tesla. Sounds like the little guy wanted to skim some off the top but got caught red handed. Smack down time!
sundaymorning
Active Member
The Wall Street Journal is owned by Rupert Murdoch. He has some ownership stake in Genie Oil. I’ll stop here.
Genie Energy - Wikipedia
My bad; I apologize--should have refreshed my memory. It was Magna not BorgWarner.
Tesla v. The World: Does Silicon Valley's Car Darling Have a Case? Expert Opinion
Are you serious? Strapped for cash over a 500k contract dispute? No offense but I think you may be insane. There is a good chance they end up paying more than that in legal fees to fight it.
Krugerrand
Meow
That’s got nothing to do with the post to you.
dc_h
Active Member
I forgot this thread for a long time. Appreciate the discussion. Tsla tends to be a bipolar stock, where it’s all great until it’s not, then it’s all terrible until it’s not. I disagree with your premise that competition will be bad for tsla and that their margins don’t support the business. We will know better by the end of 2018 as the 3 hits stride. If tsla is not cash flow politic is q3 when Model 3 production is over 5000 per week, your argument will appear much more valid. If Tesla is cash flow positive as M3 hits 5k per week, while they start the next phase of the gigafactory and the global charging stations continue to expand and the continue the 50 to 100% growth of service and sales locations yoy, your argument will lose its foundation. Regarding competition, even if there is scaled competition by 2020, the total volume under plan today is under 500,000 in 2020, and all of those plans have moved to the right the last 5 years. Past performance is no guarantee of future results, but it is indicative. Indications are any competition from bmw, VW, Audi and Mercedes will be smaller scale and later than initially disclosed.
We will see, but for now, any compels small in scale and only highlights EV as the future of transportation. In that regard it all helps Tesla.
Yar.
Meanwhile, Tesla just received another million in semi reservations...
RobStark
Well-Known Member
How much is the asbestos company paying in legal fees trying to recover $500k?
While I'm quite sure that Mr. Maron is an incomptent chief legal counsel based on his screwups regarding copyright law, I don't see the relevance here. (a) Tesla specifically stated that the contractor performed work they were not authorized to do. (b) There seems to be strong evidence based on timeline that the factory didn't have lead paint, and didn't have asbestos insulation in most places at least. (c) This doesn't seem to have been government-mandated work.
Am I missing some arcane detail of asbestos remediation contract law which says that contractors can do work without authorization and bill for it? Because I haven't seen that in my review of general environmental remediation law.
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