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Tesla: Short Squeeze Of The Century
6 years ago

Very feeble argumentation, such as #Tesla has been profitable for 2 quarters or Tesla is a Silicon Valley startup, so it has" the potential to do things much better than the status quo dictates"

The truest of your statement, is that yes, there is a possibility of a short squeeze, which would be advantageous to shareholders in the short term and would certainly hurt the short side. But it wouldn’t, in any case, invalidate skeptics’ worries about the company, nor would it suddenly improve Tesla’s dire financial situation, nor improve its amazingly unproductive factory.

Your analysis is based on hubris, not facts and certainly not numbers, such as the debt level of Tesla, the losses every quarter, and their implication on Tesla’s potential to invest in a new factory or simply not go broke.

When you mention a number, such as 25 % gross margin, you do not for a moment question it, or compare the way Tesla calculates gross margin vs the rest of the car industry.

You base your projections on nothing, such as “I believe Tesla will be profitable in mid-2019”. Care to share your simulation model?

Elon Musk cannot be trusted. Absolutely. He refuses to rename Autopilot, a misleading brand and false advertising claim. Almost all his financial & production numbers projections end up being wrong. The $TSLA Shareholder's newsletter is a lie vs 10-Q. He already said in 2012 that Tesla would never need to ever raise another funding round, and we know what happened since. He has a board which is composed of friends and family. He had Tesla purchase SolarCity, a great deal for him and his cousins, a horrible deal for Tesla shareholders.

A few facts:

-Tesla is hemorrhaging money on 45+k Model 3;

- Tesla is hemorrhaging senior executives;

- Tesla is losing money at a fast pace;

-Tesla has no superiority in “extensively automated production”, contrary to what you write, against all facts: productions numbers almost always come up short, Musk himself acknowledging too much automation, loss per can, need to move from 5x2 shifts per week to 7x3 shifts per week, and so forth;

- ZEV credit will end within 2 years, which will be a huge competitive advantage for new entrants, unless laws are changed;

- The demand for S and X is low;

- It is strictly impossible for Tesla to begin producing Y & trucks soon.

- Anecdotal evidence, which would need to be checked, is that Tesla is totally overwhelmed by support, can’t sell its customer base spare parts as needed, and even loses service requests. That’s a great way to alienate Tesla supporters or champions in the course of a few years.

- The automobile industry is not a pure tech industry. Yes, Tesla benefits from a first mover advantage. But it’s probably not that significant since an electric car is much simpler to build than a traditional car, since most of the competition has decades of experience building vehicles, and since Tesla has not built a competitive advantage with a superior battery technology.

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