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Structurally FUD

Structurally FUD

I've had a rather depressing, eye-opening week. Since Tesla's Q2 report hit the street and one analyst declared Tesla "structurally bankrupt" (a term which, by the way, has no meaning in the study of economics), I have had several people approach me about Tesla's demise. It seems that the standard TV news outlets have really been leaning on the "record sales but still posted a loss" mantra. My brother, a recent Model 3 purchaser, even called this morning for reassurances regarding the health of Tesla and its ability to survive.

The more successful Elon gets, the more intense the FUD (also known in saltier circles as BS) becomes. At this point I know people who think Elon is 1)a flim-flam man, 2)a communist or 3)an unscrupulous cad preying on an unsuspecting public. Most of these attitudes come directly from listening to the likes of Rush Limbaugh. I wish I could say these people are a very small sample size in a very local setting, but the voices that feed these people are everywhere. It's how fake news became the only reliable source of news, and relatively moderate news sources became the new "fake news".

It has indeed been a very depressing week.

jimglas | 31 juillet 2019

there is a lot of money and many industries at risk with Elon's disruption. It will only get worse

andy.connor.e | 31 juillet 2019

Its only been a depressing week? Its been a depressing 3 years for me. Got involved in the forums and got closer to following Tesla after hearing about the Model 3 and the solar roof. Nothing but negativity for 3 years. No one has anything good to talk about. Cant talk about what Tesla is doing to friends or family because they just dont believe its real or something. Everytime i try to talk about something amazing thats coming, theres always a question of sheer ignorance thats dismissing in its entirety.

Electric Sedans trucks and semis, Utility and residential energy storage, Solar (panels and roof), Supercharging network, Insurance, Tunnels, Space Travel, Global Satellite Internet. I cant understand how people cant see that as exciting.

johncrab | 31 juillet 2019

Hey, Tesla and Elon make mistakes because this is an imperfect universe. I am fearless in calling them out when they do mess up because putting up with inadequacy is not a way to boot a company up the arse to do right by its customers. I also have a more charitable view of Elon. He's none of the things you said people are calling him. He is impetuous and he a dreamer and without dreamers this would be a very dull world if it even existed at all. He has a tendency to go chasing off after bright, shiny objects and that is his critical flaw. He spreads company and personal resources too thinly (SolarCity). He obsesses over one big thing (FSD) while letting the nuts and bolts of the company suffer and languish (customer service). He needs a board which will get involved in harnessing his talents and guiding him (because that's what a board is supposed to do) and not let him run off in forty directions at once. He is the one who once said, "I'm not a car guy" and that shows at times. The purchase of SolarCity was a dumb move which diverted much needed capital and as SolarCity's fortunes decline it's a leech on the company. Gigafactories sound and look great but they suck up tremendous amounts of capital. He always wants to go for "big" and big costs. It is time to refocus the company, possibly sell or spin off SolarCity to live or die on its own and then raise capital; something he has tried to avoid but with the Q2 loss, I see no other way out. It may even be time for him to step aside and put "a car guy" in charge and go off to work on his many other projects. He's only human. He can't keep up the pace he has set for himself and do it all well.

Tesla isn't going to disappear. It is a huge company with a lot of market cap and enormous brand value. The worst case as I see it is for Tesla to be bought by one of the huge tech companies or a consortium. There is too much infrastructure, momentum and installed base for the world economy just to let it all vanish. Remember when Tesla gave away all of its patents? That was a classic move to fight a hostile takeover aiming to acquire those patents to keep the tech off the market. That was then and this is now and it's a real company, not just a stack of great ideas. Best case, they reorganize, stop the revolving door at HR, take care of customers again and get through this bad patch. I know I can be very critical when they mess up, but I speak up because I do care and I want to see the company make it and they have the tools to do that. So don't worry because this "sky is falling" crap has been happening regularly since 2012

Earl and Nagin ... | 31 juillet 2019

@johncrab,
If Tesla does half of what you suggest, they'll go out of business immediately.
- FSD keeps the 'tech' money coming in and sells cars to those with tech money.
- Gigafactories support large economies of scale much better than a lot of little suppliers like other car companies use. This enables Tesla's great gross margin.
- Solar City supports sustainability. Sure, its a tough road but its one they need to go down and, being sustainable, it will pay for itself in the long run.
- 'car guys' don't know how to build a business. They only know how to lose.
Folks have been claiming the sky is falling and they've been ignoring geniuses like you for the 13 years I've been a customer. All they've been doing is getting stronger.

NKYTA | 31 juillet 2019

@johncrab is crabby.

Null result.

rhj | 31 juillet 2019

Elon got me my Model 3.
Not directly but he made it all possible and it’s the best car I’ve ever owned so I’m happy.
Solar, well my power wall was delayed because all the cells were slated for car production.
I’ll wait not the end of the world.
Boring is making tunnels.
SpaceX moving cargo.
The future is bright on so many fronts.
Listening to the rabble it’s like a five year old wanting to be ten. Complaining it’s not quick enough.
I’m rooting for Tesla.

SamO | 31 juillet 2019

I just got to watch the premiere of driven, a movie about the life and trials of John DeLorean. He had some character faults that led to his failures. It was a startling portrayal of someone who I have known almost nothing about other than his arrest for cocaine.

He reminded me of Fisher and his Karma rather than Elon and Tesla.

@nomo,

He’s won. Tesla is past the po8nt of no return. Don’t worry about the FUD. The lead is scary long and only getting bigger. Demand is through the roof. The car costs $5 to fillup and costs less than a Camry.

Kids love it. Dogs love it. Even old ladies getting their first rides are laughing and crying.

I get calls from 3 different relatives who own Tesla asking if Tesla is going out of business. Do you know what that means? I got three relatives to buy teslas. And I’m not alone. All of us give rides and talk about the car and encourage our friends and family members to at least give it a chance, and now they are hooked.

#DriveFree

SamO | 31 juillet 2019

Fisker

TranzNDance | 1 août 2019

A lot of people stand to lose a lot of money if EVs become more prevalent or desirable. Even lay people who own ICEV would have depreciated property if ICEV becomes seen in the same way as people view cigarettes these days. It would be dumb for them not to fight for their livelihood/net worth/etc.

Tesla-David | 1 août 2019

@johncrab, you are indeed crabby and full of crap, especially your comments about Tesla's business decisions and EM. SolarCity acquisition will prove to be a sound one. I though you were through with Tesla and were moving on back to ICE vehicles based on your rants about declining service. Good riddance and don't let the door slam you on the way out!

andy.connor.e | 1 août 2019

I also recall a similar statement. That you would be selling. Did you decide that was a bad idea?

blue adept | 1 août 2019
JustSaying | 1 août 2019

Not many talk about about this revolution,

https://www.prnewswire.com/news-releases/irvine-company-completes-worlds...

As I remember Irvine Apartment Communities (a sub of the Irvine company) was the among the first to switch to "internet telephones" many years ago. (Not sure twisted copper wire pairs are used in any commercial buildings anymore)

BTW our INVESCO owned office building in Aliso Viejo(a SDGE customer) , CA is in the midst of a Tesla battery based "Hybrid Building" conversion.

DonS | 1 août 2019

The FUD folks could be right if some major catastrophe destroyed a factory, but that is extremely unlikely, Despite the FUD taglines, Tesla makes money on every car that goes out of the factory. It shouldn't be a surprise that the profit, along with some free cash, are used to develop the next product.

Eating into free cash is aggressive, but works as long the new products ramp up before the free cash runs out. Tesla's aggressiveness has certainly made other auto makers wake up.

Tropopause | 1 août 2019

Linette Lopez and Jim Chanos are the reason.

Shesmyne2 | 1 août 2019

Stop listening to Rush Limbaugh.

Still Grinning ;-)

NoMoPetrol | 2 août 2019

@Shesmyne2 "Stop listening to Rush Limbaugh..."

Tell that to the 49% of people in this country who voted Mr. Carrot-Top into the White House.

nwfan | 5 août 2019

Clinton - 48.5% popular vote
Trump - 46.4 % popular vote

Electoral count:
Trump - 306 (270 needed to win)
Clinton - 232

jimglas | 5 août 2019

a sad commentary on our citizens
We have exposed ourselves to the world
And its not a "shining city on a hill"

blue adept | 5 août 2019

It both is and isn't inasmuch as the majority of the reason why Trump got into office was not because of what sort of people showed up at the polls, but because of all of the people who didn't because they believed that the country wouldn't in a million years elect someone as clearly corrupted as Trump or those who didn't feel it worth their time.

All the same, yes, very disappointing indeed.

kinkar12 | 6 août 2019

I find some related group and join. You can also find more public experience through whatsapp group https://groupstall.com/

El Mirio | 6 août 2019

Elon often talks in superlatives, this tends to make people skeptical and take any kind of set back or delay as proof that Elon is trying to deceive, completely ignoring his achievements.

I talked to a Taxi driver recently and was trying to convince him to get an EV, he was using about 300 liters per month of fuel (in Europe, at 1.40 per liter = $420.00 per month).

The fuel savings are enormous, still the driver would not believe me have come a long way, arguing the local topography could not work for EV´s. Basically ingrained range anxiety unwilling to take in new information, even if it would boost his bottom line, probably double it.

I speculate that a lot of peoples experience with consumer electronics battery degradation, hampers their ability to contemplate BEV´s at all. In my conversations many dismiss it from the get go.

At least the folks which are open minded get to profit before EVs go main stream.

blue adept | 6 août 2019

@NoMoPetrol

This might come across as overly obvious, but if you know this all to be BS, then why has it "...indeed been a very depressing week" for you? Shouldn't you just disregard all of the FUD out of hand in light of the facts that we're all aware of?

Just saying.

JustSaying | 7 août 2019

"Jay Leno loves his Tesla: ‘There’s almost no reason to have a gas car... ’And I predict that a child born today probably has as much chance of driving in a gas car as people today have been driving a car with a stick shift,” he told CNBC."

ttps://www.cnbc.com/2019/08/06/jay-leno-on-tesla-electric-cars-are-the-future.h...

blue adept | 7 août 2019

The times they are a changin'....

blue adept | 7 août 2019

"♪ ♩ ♪ ♩ ♫ "

SamO | 7 août 2019

Chargin’

NoMoPetrol | 7 août 2019

@ blue adept

I spend most of my time focused on the positives associated with Tesla/Musk and the inevitability of mass EV adoption. However, this is tempered by my daily exposure to Southern California driving where the sightings of 18-24 EVs in a single day is weighed against the thousands of ICE vehicles that cross my path in that same amount of time.

I would just like that inevitability to occur in my lifetime. And I've been alive long enough to see superior products not make a dent in the public consciousness. LPS comes to mind. Unless you a boating enthusiast, you've probably never heard of it. It is a solvent used on rusted bolts that puts the performance of WD40 to shame. But guess who's owned the market for the last 50 years.

An anecdotal story in my home town of Riverside CA has it that in the early 1980s a research team at UC Riverside had put together a prototype vehicle that used no petroleum products. They were seen cruising around town and started generating local notoriety until suddenly their project disappeared. A friend of mine who knew one of the researchers said that the team was given an offer they were not allowed refuse including an ironclad agreement to turn over all research papers and NEVER speak about that project ever again. To anyone.

While I do not believe that Tesla is in any danger of experiencing a similar fate to that of either LPS or the mystery vehicle in Riverside, I am equally aware that the oil industry and its affiliates (auto manufacturers, auto dealer netrworks, and elected officials who are in their hip pocket) could easily delay the EV conversion by decades.

If Tesla continues for the next several years to supply in excess of 75% of all EVs sold, then the conversion to EVs will have already been stalled. Why? Because Tesla's maximum manufacturing output over the next several years will be limited by the constraints of healthy corporate growth. They simply cannot sell by themselves enough EVs to convert the driving public in this country. The industry needs to be converted. VAG, GM, BMW, Mercedes Benz, Hyundai, etc. need to quit with the CAD renderings and start producing EVs.

blue adept | 7 août 2019

@SamO

Ha!

+1

blue adept | 7 août 2019

@NoMoPetrol

Oh ye of little faith...

While I do agree with your rationale, the reality of our use of fossil fuel burning ICE's has created an existential threat to our very survival, the ramifications of which are only further exacerbated by our continued use of them and no manner of influence to the contrary by the "oil industry and its affiliates (auto manufacturers, auto dealer networks, and elected officials who are in their hip pocket)" can do anything to change that irrefutable fact.

There are things we want in Life and things we need in Life in order to actually live. 'Need' trumps 'wants'. We NEED to stop using fossil fuel-based power and commuter platforms in order to continue living to even have the opportunity to develop those 'wants' I mentioned earlier.

Conversion to a sustainable platform is an inevitability, one that we desperately need to embrace sooner than later.

How do you really think this is going to end up playing out in light of the unavoidable facts?

blue adept | 7 août 2019

We cannot continue to ignore the arbitrariness of killing ourselves solely for the sake of a handful of people's 'want' of selfishness and greed over all of our 'need' for an environment in which we can live.

A simple, basic, commonsense reality of Life itself.

NoMoPetrol | 7 août 2019

@ blue adept "...How do you really think this is going to end up playing out in light of the unavoidable facts?"

I think China will will make the total transition to EVs first, followed by the EU.

As for the US, half the people in our country do not accept the premise of your argument that burning oil-based products is affecting our environment. They consider your facts to be quite avoidable. And they are well represented at all levels of government. I expect that there is as much chance of the US becoming 90% EV as there is of our country descending into a modified Third World oligarchy.

blue adept | 7 août 2019

@NoMoPetrol

By my calculations I'd put that percentage at less than half of the country that do not believe the dire circumstances of our environmental situation and that's only because they've pigeon-holed themselves into some echo chamber of perpetuated lies, falsities, innuendo, obfuscation and fantasy, but even all of that can be remedied with a healthy dose of REALITY and the TRUTH, afterall, seeing is believing, right?!

Other than that I'm pretty much agree your predictions because I'm aware that even China knows they really haven't any other choice as they're already choking on their own air and having to walk around with masks on to avoid breathing all manner of particulates their air is saturated with in many regions, so it's a 'do or die' situation for them.

Thing is I don't want to see that become the case for America as well.

It is good that they consider it "quite avoidable" as the only way to 'avoid' it at this point is to adopt the clean energy platform of EV transportation and the use of renewables for power generation because that is the state or world is in right now and we don't really want to become like China, do we...?

blue adept | 14 août 2019

"or" = our, as in ...our world....

JustSaying | 14 août 2019

I got this yesteday. Good news it is in the WSJ Opinion.section.

Dear Colleague,

In case you missed it, a conversation starter for your next cocktail party (attached). Perhaps saving the planet will not be so easy as some would have us believe. Can you say "unintended consequences"?

https://www.wsj.com/articles/if-you-want-renewable-energy-get-ready-to-d...

"The world always makes the assumption that the exposure of error is identical with the discovery of truth--that the error and truth are simply opposite. They are nothing of the sort. What the world turns to, when it is cured of one error, is usually simply another error, and maybe one worse than the first one." (H.L. Mencken, 1880-1956)

Peace and love,

blue adept | 14 août 2019

Just read the article and, clearly, he's just another FUD'ster out to try to define the narrative in a way that is beneficial for and supportive of their pro-fossil fuel agenda and, right off of the top of my head, the term "recycle" occurs to me as in, we can recycle all of the materials used in the construction of renewable energy devices, products and equipment, thereby limiting the impact on our natural resources indefinitely.

In fact, a majority of the materials required to construct renewable energy products could be had from recycling, renewing and reusing existing fossil fuel products, materials and infrastructure, further reducing their lingering impact on our environment, our world, our lives.

Not to come across as pretentious or even presumptuous, but it seems to me that someone who is suppose to be as smart as this "Mark P. Mills" character allegedly is, what with having a Bachelor of Sciences honour's degree from Queen's University and being a "senior fellow" at the Manhattan Institute (A free-market think tank focusing on economic growth, education, energy & environment, health care, legal reform, public sector, race, and urban policy) and a partner in Cottonwood Venture Partners (an energy-tech venture investment fund that caters to the oil and gas industry, you know, fossil fuels), such overtly obvious and simple solutions would've occurred to him as well, well, that is if he weren't so interested in protecting his fossil fuel vested interests.

I find it a shame really, for someone who's suppose to be so smart only to have them present themselves as someone so stupid.

Really little more than just another short seller with a spiel.

Just saying....

jimglas | 15 août 2019

more fossil fuel BS from a right wing rag

JustSaying | 18 août 2019

Very good summary of Jack's conspiracy discussion.
Tin foil hats on please;

https://www.youtube.com/watch?v=vfILTM_xcOE

TeslaTap.com | 19 août 2019

Luckily there are plenty of smart people who understand the value. While I'm all in to help fix climate change, the biggest success comes from personal savings as well.

Rooftop solar is now a 3-year payback in many areas, and due to clever financing, it can cost an owner nothing if they want to go that route.

I expect 98% of the people considering a car in the $25K and higher range, will find a $35K+ EV being a far more economical solution over 4+ years. Not everyone understands that yet, but they will. Doesn't matter what you believe about climate change, getting a better value can accomplish far more. As it accelerates, more and more new ICE owners will be looked upon as being really stupid, when they could have saved a lot of money and gotten a far better EV car.

Neomaxizoomdweebie | 19 août 2019

@TeslaTap.com,
I completely agree. Offer the masses a product that is sleek, stylish, and actually saves them money? Sold! Oh, and it is also good for the environment? Sure, I'll still buy it, why not?