Electric vehicle maker Tesla is facing billions of dollars in losses from its new production plants, supply chain issues and pandemic-related lockdowns, which has led CEO Elon Musk to mention the possibility of bankruptcy in a recent interview, CNN Business reported.
“The past two years have been an absolute nightmare of supply chain interruptions, one thing after another. We’re not out of it yet; overwhelmingly our concern is how do we keep the factories operating so we can pay people and not go bankrupt,” Musk was quoted as saying in an interview with a Tesla owners group.
Tesla is coming to the end of what is turning out to be its most difficult quarter in two years, CNN Business wrote, due in part to the operations shutdown of its Shanghai factory due to Covid-related lockdowns in the Chinese city.
Musk also revealed in the interview that the company’s factories in Berlin, Germany and Texas, United States are costing the company “billions of dollars” in losses due to supply chain issues that has left the firm with “puny” output so far, the report cited comments recorded at the end of May but not released until last week.
“Bankruptcy is a real risk for [Tesla], [because] a lot of their cash is locked up in China,” said Gordon Johnson of GLJ Research to CNN Business. Tesla was not profitable until venturing into China, and China does not allow companies to repatriate money made in the country, which presents Tesla with “a real problem”, he said.
The American electric vehicle maker reported its first quarterly net profit in two years in Q3 2018, and recorded its best sales, profit and revenue in the third quarter of last year. That successive run of profit is set to end, according to analysts surveyed by Refinitiv, CNN Business reported.
The analysts forecast that Tesla’s adjusted earnings in Q2 2022 will drop to US$2.5 billion (RM11 billion), down from the US$3.7 billion (RM16.3 billion) it made in Q1 2022. This would however still be an increase over the adjusted income of US$1.6 billion (RM7.03 billion) it recorded in the second quarter of 2021, according to the report.
Tesla sustained a 0.1% reduction in vehicle production in Q1 2022 compared to Q4 2021, CNN Business wrote, though year-on-year production was 69% higher.
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Tesla factory is dollar furnace. Next, Indonesia buying Tesla?
Let PRC buy it
Since money-in
Cannot come-out
China wont be stupid to buy over the American assets since they have their own EV manufacturers currently running in the country.
If the American govt can sanctioned and delisted all the Chinese corporations in America, China can do so in retaliation.
Where are those jokers who were laughing at Malaysia cuz Jokowi was trying to pull Tesla into his country now?
So you believe tesla gonna be bankrupt?..hahahahaha
People didn’t think Enron would ever go bankrupt, or even Lerhmann Bros. History says otherwise….
Tesla’s stock price is trading at 100x PE. ONE HUNDRED. It is literally a house of cards hoping inflate into its valuation before it all comes crashing down.
It most likely won’t crash totally quite like that. But to think suggesting it is a joke and ‘impossible’ coz ELON MUSK, is just fanboi words.
Mollusk fanboys so quiet…
Elon Musk is too eccentric,egoistic,unrealistic.
Where in the world,did he set up a giga factory in China,knowing Xi Xin Ping wont let him repatriate profits there? Is this pure stupidity or simply being too naive?
The world’s richest man..can he be that stupid? Unbelievable.
I don’t think he is stupid. He is super smart. Without China, he will not be richest man in the world and Tesla would remain in red up to this day. If Tesla go bust, this guy is still a billionaire.
Look at Grab, so big and well known, but never turn profitable.
He isn’t that stupid cos China disallow cash outflow but Chinese goods can so he must be buying and selling China products with billions received to resell in US doubling his profits until US banned and sanctioning alll imports causing him into financial difficulties as sanctioning China kill US economical and bankrupt companies and only in politically gains.
Beli je Tesla.
Nanti,factory di Shanghai tutup ,bankrupt,macam mana?
Spare parts problem like X50,X70 baru tahu.
Elon just spent USD$44Billion to buy a company that exist in thin air and now he got the cheek to complain his very real company is losing billions? What a joke!
El on the Musk still have billions.Worst come to worst he just let company collapse.Surely,he is not that stupid to sign personal guarantees with creditors.Creditors n shareholders will have only turtle eggs with soup left.
What’s the big deal abt this Tesla making cars that most people cant afford?
US said is the most valuable car brand overtakes Toyota…….US really a joke!
Many warned him about China but did he listen? No.
Many warned about a global pandemic b4 Covid but did anyone listen? No
Correct, because they refuse to believe the people in China eat bats. When they finally believe, its too late.
Expected somewhat…Fiat money & Overhyped orbital growth valuation. All it needed was a banana skin in likes of C19 and it’s non health related vagaries!……The shorts are going to come hard and fast with Bill Gates leading the charge!
Here’s a thought: just as musk became a republican, what is there to stop him being the next Chinese billionaire by becoming a Chinese citizen?Aileen GU did, yes? He still gets to keep his american, European and Chinese assets.
There goes my TSLA stocks… burn baby… burn…
harap proton beli Tesla, lepas tu buka kilang kat kuala lipis
Didn’t tesla or elon musk buy into bitcoin? When announcement was made at usd37k and now its less than usd20k
Elon Mars rockets may end up as water tank for the American Street beggars.
Dude, is this news from 2010 when majority still doubt about Elon and Tesla?