I just threw a couple percent into some TSLA puts, betting on the end times for TSLA shareholders developing sometime in the next 7 months. If the stock can dip below 35, I’ll make a fat payoff. If not, I lost a couple percent (my account deviates by more than I’m betting).

I’ll start by giving a little bit of good news to you TSLA owners. As it turns out, I know one of the guys who helped build their assembly line. That took some hunting, but he mostly had good things to say about TSLA manufacturing.

1) The line is clean, finished, and should be good for up to 35,000 vehicles per year
2) The line is state of the art and not vehicle specific – retooling is easy for new products, unlike at the big automotive companies
3) Building the line was a clusterfuck and TSLA lost its ass; but it made a good move and fired every supplier, then rehired who was needed. TSLA also started scalping their suppliers of their workers – so the company has built up some good internal manufacturing experience by stealing from their contractors.

My friend is rather proud of the TSLA line, and had nothing but good things to say about it. There shouldn’t be any unforseen calamity coming from their production abilities, unless projections start calling for more than 35,000 vehicles per year in the immediate future (assuming they don’t have time to start up another assembly line).

Now for the bad news. My friends are all engineering car junkies (every conversation inevitably turns to auto…ugh) and we held a little pow wow this weekend. There’s a good bit of doubt that TSLA can continue meeting their sales. Even the guy who helped build the line cracked a joke about them just needing to sell cars now.

One of the bigger car guys pointed out that TSLA is trying to outsell several of the luxury/performance car makers “combined”.

Mind you I started the conversation by bashing TSLA a little. Back in ’08/’09, I told this same crowd of friends that GM was going bankrupt and they almost stoned me. Insulting coveted and beloved automotives in this circle is generally met with outright hostility.

When I trashed TSLA, nobody defended them. I was surprised.

The general feel of the group was that TSLA’s product is beautiful, but they don’t stand a chance of edging out other luxury/performance vehicles at the Model S’ price tag.

Now for the worse news.

AutoData is reporting that TSLA sales dropped 15% in May. TSLA shareholders had better pray that’s a one off, and not demand for their vehicles being satisfied. Because at $104 with sky high price to earnings and intrinsic value near to $10 (after the issuance), any disruption of the dream will disembowel the stock. And since Musk just raised a billion, half from new shares, sentiment against him could turn pretty rapidly if people start to get the idea that he duped them.

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