What's Up With Tesla ?

Tesla stunned the world 

when CONSUMER REPORTS,

which I subscribed to at the time,

said the first Tesla model

was the best car 

they had ever tested !

... although the car,

and the company,

were too new 

to have a reliability record

from surveys of CU subscribers.

so the recommendation was 

conditional, until reliability data

were available.

From no company at all,

to a first model that was

the best car ever tested

by Consumer Reports, 

was stunning.

Even more stunning 

is CU generally favors

family cars -- while the 

original Tesla looked 

and performed more like

a high performance 

sports car.

The Tesla was also

a good looking car,

which I consider 

to be a rare quality --

when I first saw one

on the highway in Michigan, 

I felt compelled to speed up 

to find out what it was.

I expected huge reliability 

problems with the: 

new company /

all-new model  / 

new technology 

original Tesla car.  

The original Tesla 

was the highest degree

of difficulty product 

for engineers

that I've ever heard of --

A more difficult project

than the original all-new

1996 Ford Taurus, 

which had HUGE 

reliability problems,

in spite of being 

a product from

a long-existing 

auto company,

using a conventional 

gasoline-powered engine.   

Well ...

Consumer Reports

subscribers who bought

the first Tesla model

had enough reliability problems 

so that Consumer Reports

had to withdraw their conditional 

high recommendation.

In my opinion Tesla has 

gone downhill ever since.

at an accelerating rate,

with the recent, bizarre

CEO pay decision 

by the shareholders, 

who seem more like

an Elon Musk cult.

Tesla shareholders recently

approved a pay package 

for their "cult leader" 

(CEO) Elon Musk, 

that could potentially

pay him $50 billion

the next decade.

$50 billion, 

yet Tesla’s 2017 

4th quarter financial report 

(page 24) states that Elon 

“does not devote his full time 

and attention to Tesla”.

Up to $50 billion,

which would be 

$5 billion a year,

would be the largest 

CEO pay package

in history !

The $50 billion 

is undeserved

and an embarrassment 

for capitalists like me.

A potential of $5 billion a year

is more than the compensation

of all current S&P 500 CEO's 

combined !

So far Tesla’s has provided 

more than $4.97 billion 

of operating losses 

for its shareholders.

Tesla is also being investigated

by the SEC, but never bothered

to mention that to shareholders!

If this is not typical of

of the irrational behavior 

often seen near market tops,

then I don't know what is !

We are waiting,

after many delays,

for Model 3 production,

to ramp up to the intended 

full mass production speed,

... while demand falls 

for the old Model S and X.

Consumer Reports'
early impressions of the
new Model 3 are mixed.
https://www.consumerreports.org/hybrids-evs/tesla-model-3-first-drive-review/

The next problem, 

after the Model 3 
production speed ramp up,
and quality issues,

is 85 SEC letters / investigations 

of Tesla in the past five years !

(compared with zero for Ford Motor,

in the past five years).

And two top finance people 

left Tesla in the last month,

which always makes

investors very nervous

... while Tesla needs capital

from Wall Street banks,

or private investors 

-- up to $8 billion 

in the next 18 months, 

to fund operating losses, 

capital expenditures, 

debts coming due, 

and working capital needs

to launch the model 3.

When a company is under 

formal SEC investigation, 

it's difficult to raise capital 

from public markets,

because these investigations 

must be made public

in the prospectus.

Tesla's 5.3% 2025
bond price decline
is another concern:
https://www.theatlas.com/charts/S1QQYV59M

Tesla was recently worth 

twice as much as Ford Motor,

who made six million cars 

last year, at a $7.6 billion profit, 

while Tesla made 100,000 cars, 

at a $2 billion loss.

Ford has $12 billion

cash for “a rainy day”, 

but Tesla could 

run out of cash in 2018,

if investors stop throwing

money at the company,

which seems likely, 

eventually, 
if not this year,

and then Tesla 

would go bankrupt,

like many other 

automobile manufacturers

in American history !