Re:Tesla is heading for a cash crunch
by dragontamer on Friday April 06, 2018 @01:53AM
(#16771186)
> The Economist is under estimating Musk and they should give him a little more credit given his track record. Telsa is not a slam dunk but it's also nowhere near as fragile as they make out. Musk also has a bit of equity in SpaceX he could lean on if the markets demur at the end of 2019.
Tesla is going to run into issues in 2019 if they are unable to ramp up the Model 3. Tesla lost $1.6 Billion last year, and they only have $3 millionish in cash. Furthermore, Tesla has debt that is due in 2018 (~$300 million or so) and early 2019 (~$900 million).
Over the next year, Tesla needs to pay off $1.2 Billion in debt, AND needs to increase revenue by ~$1.6 Billion or so to stay even. They're not exactly in a good situation.
I'm relatively confident that Mr. Musk can raise another $3 billion in capital through stock offerings or rolling over their debt in the short term, but those options have some risks involved. Furthermore, people will not want to lend money to Tesla if they think that the company is sinking.
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All the while, Tesla has bought SolarCity and also inherited all of its debt and issues. Tesla was having enough issues ramping up Model 3, but now they ALSO have to make the solar company profitable too. It was a bad time to buy SolarCity.
https://static.seekingalpha.com/uploads/2018/3/1/37229846-15...
Tesla is going to run into issues in 2019 if they are unable to ramp up the Model 3. Tesla lost $1.6 Billion last year, and they only have $3 millionish in cash. Furthermore, Tesla has debt that is due in 2018 (~$300 million or so) and early 2019 (~$900 million).
Over the next year, Tesla needs to pay off $1.2 Billion in debt, AND needs to increase revenue by ~$1.6 Billion or so to stay even. They're not exactly in a good situation.
I'm relatively confident that Mr. Musk can raise another $3 billion in capital through stock offerings or rolling over their debt in the short term, but those options have some risks involved. Furthermore, people will not want to lend money to Tesla if they think that the company is sinking.
-----------
All the while, Tesla has bought SolarCity and also inherited all of its debt and issues. Tesla was having enough issues ramping up Model 3, but now they ALSO have to make the solar company profitable too. It was a bad time to buy SolarCity.