Place Your Bets - Former GM VP Bob Lutz Claims Tesla Will Be Out Of Business By 2019

Everyone is entitled to their opinion. And it is worth the same as the next guy's, about 2 cents.

Bob Lutz has been in the industry for a long time - and has more knowledge about the industry that anyone who posts here. It does not appear that he is Anti - Tesla - he is speaking from the information he knows and has - and while he is probably being overly pessimistic - it is clear that Tesla does not have long UNLESS the Model 3 quickly corrects its production problems. THE longer it takes - the more likely there will be competition from many other manufacturers.
For Example - if GM had brought out that SUV EV First - it would be having problems keeping up with the demand that the Model 3 owners would have switched to. That they brought out a weird looking little hatchback gave Tesla more time. IF GM were to get that SUV out quickly - they could hasten the end of Tesla.

Bob should be one to talk considering he helped bankrupt GM, oh and Americans did lose billions bailing them out versus Tesla which paid back their loan early and with interest.

Who knows when the day will come, but if there is NO cash being generated, it is only a matter of time.

Tesla has been under capitalized from the start and it is COMPLETELY different than other technology "knowledge" companies (facebook, google, uber, etc) in that Tesla is trying to make a go of it in a CAPITAL INTENSIVE BUSINESS.

I suspect there will not be a gradual slow-death end but instead once the money and financing dries up it will be a matter of weeks.

The first sign will be the stock sell-off - current stock price of $307 translates to a market cap of $51 billion. Stock will start to 'gap down' (see chart of Valeant Pharmaceuticals (VRX) (which at least has a cash-positive underlying business) which hit a high of $216 at 8/2015. The air got let out of the balloon and the share price fell from $215 in 8/15 to $33 on 4/16 (it took 9 months). VRX is now at $15/sh. Telsa chart will be similar.

At that point, anyone dumb enough to own their Tesla outright will be left with a doorstop once the thing crashes and burns. If you want a Tesla, lease it. If you own a Tesla, trade it in and re-lease one. Trust us on this.

Excellent points.

One has to wonder how long Musk can successfully keep up the "futures" hype in order to pump the stock like he did last week. It's like the Wizard of Oz. Sooner or later the curtain gets pulled back and reality hits.

All the signs point to financial collapse. Speed the day that this swindle is over.

Important note: Lutz said “...[Tesla] is going out of business. At this rate they’ll never get to 2019...” The qualifier is "at this rate". That rate might change.

Also note that December 31, 2019 -- the last day for this prediction to come true -- is just a hair over 2 years away.

I observe that Blackberry (formerly Research In Motion), has been dead as a mobile phone manufacturer for about 8 years now. In all respects, they're a mere shadow of their former glory. And yet, they are still not bankrupt. {Insert an "I'm not dead yet" Monty Python joke here.}

So what exactly would an "out of business" Tesla look like? Literally chapter 11? No longer a relevant car maker?

For the record, I have a hard time imagining that Tesla Motors will continue as a leading automobile manufacturer, or even be a relevant automobile manufacturer, for the next decade. Perhaps bailouts or buyouts might change that.

Tesla will be sold well before it goes under. Likely to the Chinese.

Tesla will be out of the business of mass producing vehicles after the first generation of Model 3 has proven itself...this probably be in the middle to end of the next decade not 2019. After that Tesla will develop Model s/X/roadster models which are at the cutting edge of battery tech to showcase the future of the technology. Other than that they will become a OEM supplier of batteries and EV drivetrains.

Tesla will be out of the business of mass producing vehicles after the first generation of Model 3 has proven itself...this probably be in the middle to end of the next decade not 2019. After that Tesla will develop Model s/X/roadster models which are at the cutting edge of battery tech to showcase the future of the technology. Other than that they will become a OEM supplier of batteries and EV drivetrains.

Your comment was idiocy the first time you said it.

Then you're a fool. Short em up if you really think that.

One of the points he made seems to elude others, particularly Tesla fans, who tend to display lots of ignorance about business and the auto business in particular. He said what others have : Tesla has no "moat" to protect it from competition, or , in Lutz's words, Tesla has no technological advantage over any other automaker. That is quite obvious in the fact that Tesla has no patents and the electrified portion of vehicles can be constructed by anyone from the same off the shelf pieces that Tesla uses. A good example were the two vehicles Tesla revealed the other night - the truck and the "roadster" (it's not really a roadster, but, of course, Musk is not a car guy). Each of these had characteristics that seemed impressive, but nothing they contained was designed by Tesla - the batteries and motors can be bought by anyone. Some Tesla fans used to brag about Tesla superchargers and their recharging speed and even claimed that it gave Tesla big lead against the competition. Then a few weeks ago, Porsche, who had never even built an electric car, displayed their CCS recharge protocol for their prototype electric and demonstrated that it could recharge twice as fast as Tesla's superchargers and would be available to any other automaker who wanted to use it. So much for Tesla's big lead in recharging. As for Tesla's "fastest production vehicle" (their proposed roadster), it is neither a production vehicle nor is it likely to be the fastest by the time it comes to market. All one need do is stuff more bateries than Tesla into a chasis and Voila!, a faster vehicle. Tesla's Musk misleads his customers by making claims implying that they are based on Tesla technology.

One of the core reasons why Silicon Valley companies have had such a competitive advantage over other tech companies all around the world. Many of the technologies companies here have can easily be replicated anywhere else in the world. What is difficult to replicate is the culture and the pace of innovation. That pace is why small companies and startups can compete with slower, larger companies and why Silicon Valley companies still have such a competitive advantage despite many drawbacks (insane salaries companies have to pay, over-regulation, high taxes, high cost of living, etc.).

Why do you think Tesla gave away their patents? They don't really matter.. by the time a competitor integrates them into their product, Tesla is already working on their next gen iteration of that product. Look at how many times per year they update the Model S/X versus competitors.

The CCS charger is a great example. Sure, Porsche finally one-upped them with a concept that has yet to be mass produced and rolled out. The Model 3 already supports 250 kw charging, and there is a special surprise being built into all new S/X cars that surprisingly nobody has figured out yet. The megacharger they showed last week for the Semi does over 1 MW (some even say 1.5 MW), dramatically higher than CCS using a plug that is the same size.

OTE software updates are another example. I get new features at least 4 times a year on a car that is 4.5 years old. When was the last time your car got better for free? After 5 years of the Model S being available, only now are some other cars starting to do OTE updates.

San Jose - cool about the OTE updates. However, how fast are the processors in your Tesla? At what point does it become like a 4 year old computer that crashes every time Microsoft Update happens? At what point is it like an iPhone 5S that doesn't have the processor speed to run the updates?

Does Tesla publish any info on the processor speeds of their vehicles? I'd think that would become important at some point.

The current processor on the S/X is an Nvidia Tegra 3 (+ a Tegra 2 for the second screen above the wheel), a 5 year old processor with four cores running at 1.3 GHz. By today's standards, it should be slow... but it is crazy what you can do with good programming. So far they did 2 major updates that actually made the UI/UX faster and more responsive on the same hardware. It is dramatically better than when I first got the car 4.5 years ago, especially the map/nav and the web browser.

The updates are not mostly to fix bugs, but to add better functionality. I actually got an OTE update today (ironic timing) that adding a really cool feature. You can custom set a driver profile for entry/exit. Now when I put the car in park, the steering wheel goes up and the seat rises and reclines. When I get back in the car and put my foot on the break it goes into regular driving mode. The update also gives you more control over how the automatic gps-based garage door opener work. These are both useful features that add values to a 4.5 year old car and come at no extra cost or downside.

The Model 3 and and the newest S/X cars with Autopilot Hardware 2.5 have a new processor made by Intel with a lot more power, but it honestly doesn't seem much faster than the ancient Tegra 3. The big benefit is LTE internet on the latest hardware. Again, you can do a lot on the software side if you are not lazy.

So far the UI has only crashed twice on me ever and it was due to pulling up complex websites on the browser which I probably shouldn't be doing in a car to start with. A crash has no impact on driving whatsoever, you can actually restart the either or both screens while driving if you want (each has its own processor and OS). There is a separate CPU that handles the actual driving part thankfully.

This from the guy who gave us the Cadillac ELR and the Pontiac Solstice. Dude really has his pulse on what drives the auto industry. Lol.

This from the guy who gave us the Cadillac ELR and the Pontiac Solstice. Dude really has his finger on the pulse on what drives the auto industry. Lol.

Bob Lutz is an incompetent hack who drove GM into the ground, so I'm going to give his opinion on other companies all the credence it deserves.