Yikes! Tesla is asking suppliers to REFUND PAYMENTS.

a reply to: Mikeapollo

Well, I'll have to take your word on all of that, and will for now, as I'm not an in-depth "behind the curtain" computer guy. I started getting into the idea of building them and learning deep knowledge about 15 years ago, but gave up that dream when I realized that I just didn't have the time to do it.

Musk seems like the brain for the company, but not the business man.

originally posted by: Aazadan

originally posted by: WarPig1939
It is a shame what is happening to Tesla and I do fear they will go under or get bought out and rebranded. I do wonder what happened to the plan of eventually making electric cars more affordable. Most of these cars are way out of range of the average consumer, not only that but I believe the majority of average consumers would choose an electric car over a gas car if given the right price.

The average new car in the US costs $36,000. Model 3's begin at $35,000.

They're no less affordable than any other car out there.

Actually, nobody has gotten one of those base-level $35,000 Teslas yet. Tesla is still only filling the orders for the more upscale models that are well over $40,000 each.

That probably goes a long way to explaining why a quarter of the Model 3 reservations have been cancelled. Those people have been waiting over a year now.

There's no mystery why Tesla isn't willing to fill the low-end orders: they're money losers. General Motors, Nissan, Honda, and really any other automaker can tell you that they can't make any money on the electric cars. They only sell them as compliance vehicles, with little-to-no advertisement.

a reply to: AndyFromMichigan

Higher profit means higher priority, you can still order and buy one today though, you may wait a little while for it but it is available for purchase. Next year, if Tesla is still in business there probably won't be a backlog.

I think he is purposely doing things to lower stock value.

In the past when the companies stock fell he bought all he could.

Well, Tesla's second quarter numbers are in, and it's more of the same.

Zero Hedge has a good rundown of the numbers.

They burned $740 Million last quarter, but as always Musk promises that they're this close to being profitable. That was actually better than analysts' estimates of a $900 Million burn.

It seems as if the "improvement" is largely due to them slashing capex spending. But that will make it harder for them to continue increasing production, and develop new models. Bloomberg in particular thinks that Tesla is going to push back its planned future models (the new Roadster, pickup, semi truck, and SUV). It also seems as if Tesla is saving money by not paying their bills on time: their total debt continues to climb, and now sits at close to $5 Billion (roughly double Tesla's cash reserves).

Perhaps most worrying is something Zero Hedge barely mentions: Tesla's inventory levels continue to climb. This suggests they may already be producing cars faster than they can sell them. Continuing to increase production may actually be a mistake.

Musk said that they're going to stop taking deposits on the Model 3, and allow direct ordering (like with the Model S and Model X). That could be another sign that the backlog is falling off.