Ready For A Bailout? Tesla Is Currently Losing About $4,000 On Every Car It Sells

Why bail out Tesla? It literally has NOTHING that anyone else in the industry doesn't also have.

Why would Tesla need a bailout when they have the highest gross profit margins of any US automaker? The only reason why they have losses on a net basis is because they are spending HUGE amount of money for rapid growth. Growing at a rate of almost 2X per year is not cheap. So no, they don't actually lose any money on every car they sell, they make over 20k per car they sell.

Also, Tesla did not exactly lower their guidance, they just pointed to a POSSIBILITY of lower guidance IF there is issues when rolling out the Tesla Model X. Hence why they changed from 55k to a range of 50k - 55k.

@BobM, quoting the same flawed article from a different source is not going to change anything. Let us look at their financials.

In 2014 Tesla made 881,671,000$ in gross profit. They sold 31,655 cars. 881,671,000 / 31,655 = 27,852.50$ per car in gross profit.

This is all under GAAP accounting. Now compare it to the other automakers.

The other difference with Tesla and the other automakers is the other automakers can claim a financial profit on a car once a dealer buys it. In comparison, Tesla can only claim a profit when the consumer actually receives the car. So they have to count it as a loss until it is actually delivered to a consumer.

I'm in BobM's camp

@ BobM - I can read a financial report just fine, I also read the SEC filings and everything. Tesla is not relying on governmetn subsidies, that is nothing more than a myth. As I pointed out based on financial data, Tesla is making over 27k per car made in gross profit. Just read the SEC filings.

And there has been no reductions, all that was said was Tesla changed from 55k to 50k-55k in case there are issues with the Model X. If everything is fine, they will deliver the same 55k.

At the current burn rate they have less than a year of cash left.

And their quarterly loss has been getting bigger and bigger since 3Q 2014. Not looking very good at all.

Seems fishy to me. Why doesn't Tesla just charge $4k more per car if they are concerned with profit?

Their customers have demonstrated they care little about price. $4k is practically one option for them.

Thanks for innovating Tesla - now its time to roll up shop like Fisker, DeLorean, Bricklin, and other car startups that preceded you and get out of the way, while the big people (in US, Japan, and Germany) make the cars that everyone wants to buy at a SCALE that is actually profitable.

Try not to get caught in drug sting like John DeLorean or in another such scandal as the pieces start to unravel.

Since Tesla is such a beneficiary of government largesse, one could argue it borders on scandalous - with the nutso amount of tax dollars Telsa indirectly consumes - between subsidies and rebates and "credits" that are floating around Tesla's financials right now.

Except, Tesla has the highest gross profit margins of any US automaker and those margins are increasing.

Tesla also doesn't get any rebates. As for other subsidies, it is no different than any other automaker really.

I suggest people do their own research, and see ALL sources of revenue for Tesla Motors. If you do that, you'll discover one of Tesla's greatest talents is the ability to receive government subsidies. For example, there was a pile of federal money available to companies who created quick-battery-change technology for EVs. Tesla built it into their cars, though it's hard to say how practical it would be if it were ever used. Why's that? Well, there's only one (1) station in all of America that does this! That's all Tesla had to do to receive the big pile of subsidy money. They just had to make the tech that qualifies for the loot. They didn't have to make it feasible for actual use.

Do more digging and you'll find lots more of these example. Mr. Musk excels at discovering ways to get money out of the government, and into his company!

BTW, when I refer to "government subsidies" and bailouts, I mean "money borrowed from The Big Chinese Bank while the bill is sent to taxpayers in the form of an increased deficit and national debt." Of course the government doesn't have money of its own to give to Tesla and other giga enterprises. It runs a deficit each year, meaning it ALWAYS spends more money than it brings in.

I am not confident that Tesla will be around a decade from now. They're simply not big enough -- like GM, Chrysler, and Ford -- to merit a multi-billion dollar bailout. They'll likely pull a Fisker in due course.

There is no special pile of federal money for creating battery swap technology. What you are thinking is that there was more ZEV credits given to fast refilling in which battery swap was an option, that provision was removed.

The government also does not give any money to Tesla. The ZEV credits are sold in the private market. Many companies sell ZEV credits from Tesla to Ford to Nissan and many others.

That said, even without the ZEV credits, Tesla still has the highest gross profit margins of any automaker.

I am also pretty confident that Tesla will be around in a decade, so far their financials are doing well and they are growing every year. If anything happens in worst case scenario, Musk is good friends with Google and they are willing to come in if need be.

Weapon writes "...The government also does not give any money to Tesla..."

According to readily available information, to date, Tesla Motors has benefitted to the tune of about $4B in the form of special tax breaks, cheap government loans, regulatory credits, and subsidies.

It's a shame AutoSpies doesn't have a function for recording peoples' prediction, following up on them, and then scoring members with a "batting average" for their predictions coming to pass.

@TheSteve - Sorry, the claim was Tesla receiving a big sum of money. Not just subsidies, but CASH.

Second of all, even if you include not just cash, please provide a list of this readily available sums. Now remember that things like the 1.3 billion tax break Tesla got from Nevada is over 20 years in the future, so far they have no claimed any tax breaks just yet (they will for the following quarter), so that sum is 0$ today standing.

Tesla also paid the ATVM loan 9 years early.

But please go ahead, list these amounts that are readily available, I am waiting. An not a link, I want sums.

Weapon: I learned looooong ago that when I observe someone has not done their homework, me doing it for them and trying to convince them it's right doesn't serve either of us. Google is your friend, but I suspect you'll perceive every post regarding struggling financials, subsidies, etc. as just being wrong.

@TheSteve - Oh I did my homework, this is why I can easily tell that you did not do your homework and just lazily copy and pasted a number that you didn't bother looking into for accuracy.

The reason I want you to post the numbers and not a link is simply to publicly humiliate you when you realize the numbers you claim do not actually add up to what you claim they were. Posting a link won't do because then your humiliation will not be public but behind a link.

So while it may be true that you doing it won't serve you very well, it would serve me just fine. So go ahead. Stop running away and post the numbers. Or did you already realize the numbers don't add up and are just trying to run away?

Weapon: Thank you for confirming my suspicions with a real life demo.

No problem, willing to prove you wrong any time!