iBankCoin
I've been doing this a long time.
Joined Oct 7, 2015
95 Blog Posts

Stick a fork in $TSLA. Its days are numbered.

In-production Chevrolet Bolt. Tesla-killer?

Back in June, the LA Times posted an article referencing the above tweet from Tesla CEO and carnival barker Elon Musk. Everything Musk does is taken verbatim, accepted as truth. P.T. Barnum wished he had been so lucky.

CNBC dutifully published more fake news, this time revolving around the ‘Boring Company’, an empty shell masquerading as something real:

Elon Musk just posted a bunch of pictures of his tunnel and ‘Boring’ equipment
Elon Musk said his Boring Co. has begun digging.
Musk posted several photos of the equipment on Twitter.
The effort is aimed at building tunnels under Los Angeles.

Musk said it, therefore it is true, according to CNBC:

Elon Musk has begun digging under Los Angeles.

The entrepreneur posted Friday several pictures of equipment meant for digging tunnels beneath Los Angeles.

The project is one of Musk’s latest ventures, which was inspired by a desire to alleviate “out of control” traffic in Los Angeles

This is all pure horseshit, of course. Elon Musk and his magical boring machine have not begun digging anywhere. The pics and video in the articles are “renderings”. One truly has to be on the far side of the moon to think companies can just start digging tunnels underneath existing infrastructure purely on the conjecture and fantasy of a corporate CEO who is annoyed at the time he wastes commuting from LAX to San Francisco.

Without government subsidies, Tesla and affiliates would not have built one single car, space rocket, or “boring machine”. None. Zero. Zilch. Nada. And none built without Supreeme Leader Musk shilling at fancy parties,

…or less fancy outings for adoring Millenials and blue jean -wearing middle aged hipsters.

Musk is cool, man. And he is a hero because you know the electric car is so environmentally correct despite the enormous amount of industrial waste involved in producing massive batteries that sooner or later will have to be discarded somewhere, as well as the inconvenient fact that electricity generated from coal and fossil fuels are what powers the EV market.

There has not been a successful launch of an American car company in almost a century, and even the successful ones burned out after a few years.

The list of failures is a mile long, with many a storied name alongside some forgettable ones: https://en.m.wikipedia.org/wiki/List_of_defunct_automobile_manufacturers_of_the_United_States

There is no reason why Tesla should not have followed Solyndra as an example of government waste in the name of junk science. No reason but a huckster with the odd name of ‘Elon Musk’.

Now I think the Tesla Model X is a cool car, don’t get me wrong. I still remember the day I first saw not one, but two of them cruising along the Merritt Parkway in tony Fairfield County, CT. At first I thought they were Jaguars until I noticed the odd logo on the deck lid.

But the economics of building an expensive, limited production electric vehicle are far different from mass-producing tens of thousands of cheap vehicles on an assembly line, especially when you have no experience doing it.

Tesla is in the process of finding that out as we speak, as barely a trickle of the new Model 3 have been produced and Musk is on record claiming they would be cranking them out at an astounding rate of 30,000/month by December. Matters that would be trivial to an established car company, such as welding steel frames, are proving to be problematic. Musk brushed aside criticism as is his style, but the stock market did not, punishing the stock from it’s airy highs in 2017 down below $300/share (still an absurd price for a massively money-losing operation).

And the image of Elon Musk, Cool Guy took a hit in October when, due to the failure of the Model 3 assembly and less than anticipated sales of the Model X and the SUV, the company fired hundreds of workers. Musk tweeting that night about hosting a small cookout on the roof of the factory the night of the firings did not do much for his image. I am not sure about hanging with goofy John Oliver, either. No, I cannot imagine GM’s Bob Lutz in this picture, either.

And stories have been popping up about the fit and finish on the flagship Model X, with claims of interior panels that do not fit, along with rattles and squeaks that would doom the reputation of any mainstream car company. Let us not forget what happened to the Italians and the French in the U.S. market back in the 1970’s and 1980’s. I still have fond memory of driving my 1984 Alfa Romeo while various interior bits woukd literally fall into my lap along the way. That failure of the head gasket barely 300 miles past the 36000-mile warranty and the clutch failure at 45000 miles are also burned into my brain. I wish all the best to Alfa and FIAT as they attempt to reenter the US. The new Alfas in particular  seem well-built with stunning specs but then again, FIAT is now one of the largest if not the largest carmaker on the planet.

But it is not manufacturing woes that will doom Tesla Motors. It is competition, something Tesla has been immune up to this point in time due to it’s early entry and those billions of dollars in government largesse.

Daimler-Benz just announced they will be building factories in the US to produce EV’s and the batteries to power them. Billions of dollars have been earmarked. BMW is already building both the utilitarian i3 and the stunning i8 models. The Mercedes concept is much cooler than a Tesla. The Coolness Factor is huge and unquantifiable.

But it is General Motors that has fired the first salvo in the takedown of Tesla Motors. The Bolt EV will be a huge success. Nissan has also redesigned the boring Leaf EV, making it quite similar to the Chevy in design and less of a space-nerd rendering of what an EV is expected to look like.

You also of course have hybrids, which are gaining in popularity and are no longer defined by the wimpy Toyota Prius but rather by the hairy-chested Porsche 918 and the gorgeous and potent Acura NSX.

Then you have European countries mandating 100% electric vehicle usage by 2030 and other assorted nonsense. The internal combustion engine is not going to simply disappear. I love my 2017 Corvette Grand Sport and it’s 460hp V8 that happens to get 27mpg on the highway in Eco Mode with cylinder deactivation.  It will never be replaced with an EV. No. Fucking. Way.

Peter Tertzakian, an energy economist for ARC Energy Institute, argued in recent commentary that even with bans put in place by every country in the world and deep penetration of EVs beyond 2030, the number of ICE vehicles in 2050 will be only slightly lower than today’s number.

 

 

If you enjoy the content at iBankCoin, please follow us on Twitter

16 comments

  1. firehorsecaper

    Stunning analysis & great work. It is hard to envision this turd trading above the 200 day for some time. Shorts will be emboldened to keep their shorts, if not add. Other parts of the capital structure, if you can call it that will come under assail as well, making the next $5bln of dream funding considerably more expensive for Tesla. I would also not count out some psychotic event taking Muskers off the stage as front man, given his stage on the last “earnings” (aka night tremors) call. Hope is not an investment strategy.

    • 1
    • 0
    • 0 Deem this to be "Fake News"
  2. NotGekko

    But, but, but Elon is saving the planet from evil polluters and humankind from themselves!

    • 1
    • 1
    • 0 Deem this to be "Fake News"
  3. fryguy15

    The only companies boring tunnels in LA are Walsh and Shea as a joint venture. Probably the only construction companies in the US that are qualified for a project of this scope. http://www.walsh-shea-corridorconstructors.com

    Nice write up Maven. Those electric Benzs look awesome. Still, I must agree with you, I like my cars burning unleaded in a V8.

    • 1
    • 0
    • 0 Deem this to be "Fake News"
  4. juice

    ho hum … another human sticking another fork in Musk/Tesla .. what will he do?

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  5. the dude

    Well done. Not even a trade until the next round of funding and god only knows where that is going to come from.

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  6. sarcrilege

    This is not a “I told you so” comment but I am glad that now somebody here points out the same flaws I have been highlighting and also ridiculing the whole Tesla bullshit infatuation whenever it came up as a long play some place on this site. I still cannot figure out what Tesla’s core competency, other than fantasy and incineration of taxpayer money, is. And, btw, the same goes for Joobook and Joogle – if it were not for CIA/NSA deep state spying interest propping up these POS anti-democracy marxist companies, they would fail on their own and be much much smaller. And this is the result of brainwashed sheep letting a tiny group of usual synagogue suspects control the issuance of fake money. But hey, is it anti-semi to point out the obvious to snowflakes?

    • 1
    • 1
    • 0 Deem this to be "Fake News"
    • sarcrilege

      Oh, one more thing, EV’s are gay. I would not get caught dead in them. And there is no future for these faggaty cars no matter which company makes them. NOOO FUUUTURE!! This next financial crisis and long depression will make grid failures a daily occurrence so good luck to all you green snowflakes charging up those rattle boxes for your sunday faggot drive. I’d rather drive a K-car than have one of Teslas.

      • 0
      • 1
      • 0 Deem this to be "Fake News"
    • slowmo

      Hey, you stupid Nazi motherfucker–you can’t even spell anti-semitic correctly

      • 3
      • 0
      • 1 Deem this to be "Fake News"
    • vale

      Have you driven a MS P100D? That car is an incredible driving experience. Going back to my ICE car after driving around a Model S P100D was the equivalent of going back to horse and buggy.

      Sure Tesla got government subsidies (and Musk over promises), but with the money they build an incredible piece of technology, that no car manufacturer in the world even comes close.

      GM got bailed out with tax payers money, they never paid it back and what innovation do they have to show for?

      It’s not about saving the world, it’s about the incredible technology, and how stupid and ridiculously complex an ICE is in comparison.

      • 1
      • 0
      • 0 Deem this to be "Fake News"
  7. bushwacker2

    Very well written. Spot on. I could not have said it any better. TSLA eventually going to $160. Yes, that’s right.

    • 1
    • 1
    • 0 Deem this to be "Fake News"
  8. moosh

    Usually not a good idea to quit an 8+ year Presidential think spot group, either.

    • 1
    • 1
    • 0 Deem this to be "Fake News"
  9. reversion

    The trade all about the third meeting tho…. and the bankers still love this company

    • 1
    • 0
    • 0 Deem this to be "Fake News"
    • The Maven

      They do, but they are fickle and could abandon Tesla at thr first whiff of desperation. Those on the Model 3 waiting list are also still in love, although their money is fully refundable and the longer it takes to ramp up production, the closer we get to critical mass (break-even) on the Bolt.

      • 0
      • 1
      • 0 Deem this to be "Fake News"

Leave a Reply