The cherry on the cake is definitely this convoluted attempt by Musk to consolidate his “dreams” with the SolarCity merger. Neither company is financially sound. SolarCity has a hard time making money. Tesla ALMOST never makes money. So where’s the value? The notion that the two will create a solar house that charges your car for almost nothing is grand, but the timelines seem absurd. We can talk all we want about the merit of solar shingles and zero emissions. It very much is the way of the future. That doesn’t mean that Musk and his cohort are going to be the ones to succeed. As shareholders, you need to see a return on your investment. It has been years. Both companies have run up revenues. Both companies have failed to consolidate those gains. This story has Twitter (NYSE:TWTR) written all over it. In many ways both of these firms have been coddled into growth. Between subsidies and “enthusiastic” share pricing (which has allowed for large capital raising through stock sales), Tesla and SolarCity were given the fuel to get the show rolling. Unfortunately this same “incentive” has driven the two companies into complacency. Musk seems convinced that everyone will support his show to the end no matter how long it takes. The longer it takes to deliver some real results, the less likely this will be the case.
Billionaire Elon Musk is attending President-elect Donald Trump’s tech industry meeting, which is being orchestrated by the tech-entrepreneur’s business partner, The Wall Street Journal reported.
Musk is the CEO of Tesla Motors and SolarCity, and is a close associate of Peter Thiel, the tech investor who backed Trump during his presidential campaign. Apple CEO Tim Cook and Facebook COO Sheryl Sandberg will also appear at the Wednesday meeting.
They were both founders of PayPal — and Thiel’s venture-capital firm Founders Fund also contributes millions of dollars to SpaceX.
SpaceX has been awarded contracts valued at more than $6.5 billion over the past eight years, mostly to delivering cargo to NASA’s primary space station. It’s also working on securing contracts from the Air Force valued at more than $100 million.
“We don’t have a crystal ball,” Hector De La Torre, an Air Resources Board member, told me. “We don’t know what will take off. Fuel cells, electric, and anything else, as long as it is zero or pretty close it. That’s always been our mantra.”
The issue confronting the state is not what’s good for Tesla, or any other manufacturer, but rather how to persuade consumers that zero-emission vehicles make sense. After reaching 3.2 percent of the roughly 2 million new cars sold in California in 2014, the percentage has fallen to 3 percent. With pump prices low, gasoline sales are rising.
Musk has built a sleek car. But Tesla hasn’t turned a profit yet. Subsidy will remain important to his company’s future. That helps explain why he is building the massive battery factory in Nevada. Gov. Brian Sandoval provided $1.25 billion in subsidies, far more than California was willing to offer.
Despite the broader market closing at all-time highs, shares of electric car maker Tesla Motors(NASDAQ:TSLA) slipped 11 cents on Friday to close at $192.18. TSLA hit an intraday low of $190.81 following a research note from JP Morgan (NYSE:JPM) analyst Ryan Brinkman writing that after meeting with General Motors’ (NYSE:GM) CFO Chuck Stevens and test driving GM’s new Chevrolet Bolt, he expressed concern about Elon Musk’s company being able to achieve its profit objectives.
Commenting on the new Bolt, the analyst said the electric vehicle (EV) represents “solid competition” for Tesla’s upcoming compact luxury sedan Model 3 and that GM is the first automaker to globally market a “modestly” priced battery electric vehicle with a range in excess of 238 miles. Additionally, and to illustrate the importance of Bolt, Brinkman points out that GM plans to extend its EV beyond sales to consumers and into ride-sharing apps, including of the autonomous variety.
Brinkman, who reiterates an ‘Overweight’ and ‘Underweight’ rating on GM ($37.66) and Tesla stock, respectively, also notes that Tesla will find it increasingly difficult to profitably compete in an increasingly competitive market for electric vehicles.
It should be noted that this is not the first time Brinkman has expressed skepticism about Tesla’s ability to hit its objectives. Back in May JPM’s analyst said he was doubtful of Tesla’s production plans for its upcoming Model 3 mass-market to build a total of 500,000 all-electric vehicles in 2018, two years ahead of schedule.
“We previously held some hope that, with improved execution, Tesla could prove relative skeptics such as ourselves wrong, by in fact ramping to 500,000 units by 2020. We think they stood an outside chance of doing this. But these new targets we think standstill less chance of being accomplished within the given more aggressive timeframe,” Brinkman wrote at the time in a note to investors.
Tesla Motors Inc. said it’s voluntarily recalling about 7,000 adapters for electric-vehicle charging after two reports of overheating that resulted in melted plastic on the plugs. The rarely used item is sold through the company’s online store.
Two customers reported overheating in November, according to an e-mail the company sent to customers Tuesday. No damage besides the melted plastic was reported, and Tesla said it has notified U.S. regulators of its voluntary recall. The accessories were manufactured by an outside supplier and haven’t been sold for at least six months, according to Tesla.
The two cases of overheating equipment involved the NEMA 14-30 adapters, which are sometimes used to charge Tesla vehicles via clothes-dryer appliance outlets in U.S. homes. International customers aren’t affected. Replacements will be shipped beginning in the next few weeks, and customers should avoid using them in the meantime.
The company will also be replacing the NEMA 10-30 and 6-50 adapters, which have a similar design. Those replacements will take about three months, but as there haven’t been any reported instances of overheating in those versions, customers who rely on them may continue to use them, according to the company.
Taxpayers also heavily bankroll Musk’s businesses. Last year, the Los Angeles Times reported that Musk’s corporate empire had received a total of $4.9 billion in government subsidies.
For example, the federal government gives each Tesla buyer a $7,500 tax credit. Many states give additional credits as well.
So, yes, Musk has made billions of dollars because taxpayers are subsidizing the purchase of $85,000 dollar sports cars and costly solar panels. I doubt that will sit well with working-class voters.
The only reason Tesla was profitable last quarter stems from the sale of $139 million dollars worth of “clean” tax credits to companies that make money from the sale of traditional, gas-burning cars and trucks.
Undoubtedly, Donald Trump is also a product of coastal elitism. However, Trump was able to overcome this hurdle with working-class voters by channeling their frustrations with elites.
Democrats hoping that Musk will be their billion
A SpaceX customer has switched to a European competitor for one satellite launch, citing delays in the Hawthorne space company’s schedule after a September explosion.
Satellite communications firm Inmarsat said Thursday that it has signed a contract with French rocket company Arianespace to launch a satellite for the European Aviation Network, a broadband system comprised of both satellites and ground networks.
That satellite is set to be launched in mid-2017 from French Guiana.
Inmarsat had originally planned to launch the satellite with SpaceX, but said it decided to switch to Arianespace “following the delay in SpaceX’s launch schedule.”
A conservative advocacy group has a special name for liberal bloggers who have rushed in to defend the business practices of Elon Musk, the multibillionaire co-founder of taxpayer-funded renewable energy and space technology companies. It calls them “stoogers.”
Despite “mounting evidence of cronyism by his crumbling empire, Elon Musk has tapped stooge-like left-wing bloggers to come to his defense,” according to a press release from Citizens for the Republic, a grassroots conservative group based in Alexandria, Virginia.
The group bitingly defines a “stooger” as “a liberal person … living in their basement spewing left-wing prevarications and slander via blogs, which few read.”
CARSON CITY – The number of workers at Tesla’s giant battery factory in northern Nevada has only reached about one-fifth the level the electric car company had projected would be in place by the end of this year.
An analysis presented to state lawmakers before they approved a $1.3 billion tax inventive to lure Tesla to Nevada in September 2014 projected employment would reach 1,700 at the plant by the end of 2016.
But an independent audit conducted by Grant Thornton released on Monday shows only 331 jobs have materialized so far at the industrial park east of Sparks.