Tesla burning Cash

[jos]

Tesla is losing more than $4,000 on every Model S electric sedan it sells. it burned $359 million in cash last quarter.Tesla had just $1.15 billion on hand as of June 30, down from $2.67 billion a year earlier. Elon Musk has given himself a deadline, promising that by the first quarter of 2016 Tesla will be making enough money to fund a jump from making one expensive, low volume car to mass producing multiple models, and expanding a venture to manufacture electric power storage systems.  A typical new car can cost $1 billion or more to engineer and bring to market.  

 

Giving hackers cash is good but need to sustain first.. who will fix the car, if the company cease to exists

Source: http://www.reuters.com/article/2015/08/09/us-teslamotors-cash-insight-idUSKCN0QE0DC20150809

[brownninja97]

The best way to explain this is the playstation 3. It caused sony to lose money when they sold one, they then made money after a year or of selling that same hardware as i got cheaper, they also got noticed.

 

Tesla are playing the long game not the short one. The fools that made that article are very short sighted

[Aniallation]

The best way to explain this is the playstation 3. It caused sony to lose money when they sold one, they then made money after a year or of selling that same hardware as i got cheaper, they also got noticed.

Same with the Nexus 4/5

[Grrizz]

Exact same reason they give free licences to use a lot of their battery related patents, it helps them corner the market in the long term by hindering competitors who have a higher adoption price.

Similar to a lot of moves MS has made not just recently but in the past too

[Arty]

Same with the Nexus 4/5

windows 10 maybe?

a year of rnd without no immediate payback 

[jos]

The best way to explain this is the playstation 3. It caused sony to lose money when they sold one, they then made money after a year or of selling that same hardware as i got cheaper, they also got noticed.

 

Tesla are playing the long game not the short one. The fools that made that article are very short sighted

But they did had huge volume in sales and cash to burn..

[Aniallation]

windows 10 maybe?

a year of rnd without no immediate payback 

But they did had huge volume in sales and cash to burn..

 

Well then again both Telsa and MS do have lots of $ just sitting around

[Imabigmac]

Im surprised by how little they loose per car. 

[Aniallation]

Im surprised by how little they loose per car. 

Well it's still money lost. Also considering how expensive the Model S still seems to most people even though they're losing money off each one. Every car sold by Honda, Nissan, etc. are all making them profit.

[jos]

Well then again both Telsa and MS do have lots of $ just sitting around

Tesla Do not have the amount needed for a car company... They just have 1.2 billion and need 1 billion for a new car.. GM needed 20 billion in government fund to survive...

[samcool55]

4000 isn't that much to lose.

For every bugatti veyron sold VW loses a couple of million dollars, yea... 1.000.000+ per car compared to 4.000+, not that bad.

Atm the average loss is 6.2m per sold car, probably won't change much anymore since the veyron is out of production.

 

Yes they are in a completely different price category, but it's just an example tesla isn't the only one losing money by selling cars.

[jos]

4000 isn't that much to lose.

For every bugatti veyron sold VW loses a couple of million dollars, yea... 1.000.000+ per car compared to 4.000+, not that bad.

 

Yes they are in a completely different price category, but it's just an example tesla isn't the only one losing money by selling cars.

They do not have other cars with enough sales to compensate for loses

[SirSquid]

The best way to explain this is the playstation 3. It caused sony to lose money when they sold one, they then made money after a year or of selling that same hardware as i got cheaper, they also got noticed.

Tesla are playing the long game not the short one. The fools that made that article are very short sighted

The wiiu was sold at a lost but Nintendo made it back if you bought a single game.

[samcool55]

They do not have other cars with enough sales to compensate for loses

If you look at bugatti itself you can say the same, but because they are backed by someone else (in this case VW becuase they own Bugatti) Tesla is also backed by other companies of Elon Musk, atm the other companies are also not profitable, but if SpaceX becomes profitable it will compensate for the loss Tesla has, but i think it will actually be the other way, anyway if Tesla gets in financial trouble, Musk will probably have something else that's profitable to help it.

[dragosudeki]

It's probably just selling at a loss to get the Tesla brand out, as well as the electric car idea. I feel like too many people stray away from new technologies because of certain limitations that probably will never be experienced (or ones that no longer exist). Would personally like to see more electric cars and see the world stray away from fossil fuel. Would also like to see better improvements on extracting energy from renewable sources.

[Deletive]

If you look at bugatti itself you can say the same, but because they are backed by someone else (in this case VW becuase they own Bugatti) Tesla is also backed by other companies of Elon Musk, atm the other companies are also not profitable, but if SpaceX becomes profitable it will compensate for the loss Tesla has, but i think it will actually be the other way, anyway if Tesla gets in financial trouble, Musk will probably have something else that's profitable to help it.

 

It doesn't really work like that, Elon has to put his own money into the company, he can't just take cash from one company and throw it at the other because he owns both of them. 

[samcool55]

It doesn't really work like that, Elon has to put his own money into the company, he can't just take cash from one company and throw it at the other because he owns both of them. 

Why can't he? He is the boss, if he wants to invest in Tesla he can do that right?

I'm sure there is a perfectly legal way to transfer money from one of his companies to Tesla.

[Aniallation]

Tesla Do not have the amount needed for a car company... They just have 1.2 billion and need 1 billion for a new car.. GM needed 20 billion in government fund to survive...

Not to mention that money is theirs to keep cause they actually paid back their government loan

[Fred Castellum]

The best way to explain this is the playstation 3. It caused sony to lose money when they sold one, they then made money after a year or of selling that same hardware as i got cheaper, they also got noticed.

 

Tesla are playing the long game not the short one. The fools that made that article are very short sighted

To be fair most traders are quite short sighted. Especially the ones who make articles for the sake of trying to sway trader emotions.

[Deletive]

Why can't he? He is the boss, if he wants to invest in Tesla he can do that right?

I'm sure there is a perfectly legal way to transfer money from one of his companies to Tesla.

 

A lot of SpaceX's money is for actual projects that are funded by different sources such as NASA and such. If it's his (elon's) own money (few millions at max) were put in then it was fine, but taking millions from one company and putting into another company is not legal without a actual deal made. 

[GoodBytes]

Any new expensive / complicated product made, always leads to losses for the company when new.

Either sales are low during the product introduction, or production cost is super high and not perfected yet.

Once the company manufactures more thing, find ways to produce things cheaper, and be able to sale more of it (either higher demand or be able to deliver that demand), the company will turn in a profit.

What really hurts Tesla is that they can't turn off their R&D department (which is essentially a black hole for companies, but needed to solve problems and innovate), or slow it down. It needs to solve problems which there was never a large investment done to it before. It doesn't help that electric cars can't define the way cities are built, and defines our life style. Those were already defined by combustion engine cars. The only thing it can do is adapt (which is the hardest part), and improve those aspect, if possible (much like combustion engine cars improves our life style and city design over using horses).

[SirNumbers]

Any new expensive / complicated product made, always leads to losses for the company.

Either sales are low during the product introduction, or production cost is super high and not perfected yet.

Once the company manufactures more thing, find ways to product things cheaper, and be able to sale more cars (either higher demand or be able to deliver that demand), the company will turn in a profit. What really hurts Tesla is that they can't turn off their R&D department, or slow it down. It needs to solve problem which there was never a large investment done to it before. It doesn't help that electric cars can't define the way cities are built, and defines our life style. Those were already defined by combustion engine cars. The only thing it can do is adapt, and improve if possible.

Well said

[NinerL]

I'm sure they're doing alright, Tesla has received over $4.9 billion in tax payer money.

[soaringchicken]

All I know is Elon Musk knows exactly what he's doing, and he's definitely got this all planned out.

[BuckGup]

Idiots Elon knows what he is doing