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Tesla Posts Biggest Quarterly Loss, Slashes Production of Model X and Model S (yahoo.com)
Tesla has reported the largest quarterly loss in its history, and said it was cutting production of its Model S and Model X vehicles. Here are the key third-quarter numbers with expectations via Bloomberg: Adjusted loss per share: -$2.92 (-$2.23 expected); Revenue: $2.98 billion ($2.39 billion expected); Free cash flow: -$1.4 billion (-$1.2 billion (expected). Yahoo News reports: The company said it plans to produce 10% fewer units of its Model S and Model X models in the fourth quarter and reallocate resources to the Model 3, its newest. Tesla expects to hit a Model 3 production rate of 5,000 vehicles per week by late Q1 2018. "While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear," Tesla said in its statement. Tesla said in October that it produced only 260 vehicles, well below its target of 1,500. CEO Elon Musk said the Model 3 was "deep in production hell."
Their junk bond offering of just 3 months ago is now trading at 95 cents on the dollar, effectively wiping out their yield. The only way Tesla is going to get the cash to keep going is a massively diluting equity raise.
Longs, get out while you can.
The company said it plans to produce 10% fewer units of its Model S and Model X models in the fourth quarter
Is it just me or does that sound like a small reduction, not really qualifying as "slashes production" at all?
Shouldn't there be a journalistic rule for when something qualifies as slashing, say maybe over 50%?
Lets not get too melodramatic with the headlines.
If I had a DeLorean... I would probably only drive it from time to time.
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Meanwhile GM does about a million a month. But it's totally rational that the two have the same market cap.
The only reason why GM does more than ZERO a month is because they had $100 billion in liabilities wiped clean & a giant frickin' loan to keep the lights on.
I love this quote.
Though it's totally unclear where it originated.