Tesla Readies California Production For Model Y - Shouldn't They Consider A Sunbelt State To Save Costs?

According to Forbes magazine (who has basically made the same points many on this site have been making for two years)...

https://www.forbes.com/sites/samabuelsamid/2019/05/29/who-would-buy-tesla-and-why/#1cb670593451

...Tesla may have some brewing problems.

Great article, check it out.

Barclay's cut Tesla price to $150/share. Roh-roh.

They have an underutilized factory in Calfornia that they can use now. Being near their engineering teams in SoCal has some benefits as they do not have a mature production process. If Tesla wants to be in the business of building cars long term (vs becoming a licensor of technology) then they need to look at moving production out of SoCal. They are building a factory in Nevada, which would be much better from a cost standpoint once they can get it finished and ramp up production there.

That is a great article, but I would think is the valuation drops enough or Tesla is on the verge of Bankruptcy another automaker would swoop in and buy up Tesla. The promise to buy the panasonic batteries is not a huge liability as it is part of building EVs and those cells are the basis of the best EV powertrain out there. At $10-15 billion purchase price a lot of automakers would be interested...Toyota, Daimler, and VW/Ford splitting the purchase and operating under their alliance come to mind as the most likely purchasers. Trump would probably balk at any purchase by a Chinese company if this goes down when he is president. Toyota has the resources to purchase Tesla at the current valuation, and may swoop in before the vultures circle.

The bit about Amazon buying Tesla is a bit far fetched...it would be way too big of a distraction for any tech company to become intimately involved in auto manufacturing. Contract manufacturers like Magna do not have the capacity to put out 300k+ vehicles a year.

We have to remember that valuation is the theoretical value of the company, but most decidedly NOT its worth in a sale.

Magna could do that. They have lots of idled plants in Ontario collecting dust that could be used for sub assemblies with final product being finished in a bigger facility or even take over any of the big 3 plants not being used or under utilized like Lordstown or Oshawa. Magna has the money, the know how and ability to become a full scale OEM although Frank and Don are probably kissing their lucky asses that they didn't buy Chrysler before Cerberus did as we all know how that turned out...

It may benefit Tesla to announce a Texas manufacturing center as a means of bypassing the all-powerful crony capitalist Texas Auto Dealers Association. Texas lawmakers currently are led around on a leash by this organization and Texas is one of the handful of states that does not allow direct car sales. ...but if Tesla were to lay out a public trade on building a huge manufacturing factory contingent on lifting the sales ban that might do the trick and put public pressure on the Texas Legislature.

Right. And right now the share price is far too high to attract a buyer. Analysts are currently putting Tesla at around $120/share by year end, which is still 18x projected 2nd Qtr earnings. The price will fall below $90/share before any serious interest.

The purchase price for a publicly traded company has to be higher than the current stock market price so that shareholders have an incentive to sell their shares. A “take under” will never work especially for a company as widely held as Tesla.

lmao, no.

I cannot wait to see the new refresh interior of the Tesla S in September!

The model S interior needs to be significantly improved in quality. Dropping a model 3 interior into a Model S will give people even less reasons to upgrade to the S

I don't think they will do that. I would be shocked if they use the Model 3 seats like reports have mentioned. The screen orientation will almost definitely change, but I think they will go premium for all of the finishes.