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List Of Departing Tesla Execs Similar To Waning Days Of Enron And Valeant: Chanos

We remain short shares of (and long put options in) Tesla, Inc. (TSLA), which I consider to be the biggest single stock bubble in this whole bubble market—a company so landmine-filled that I think it can implode at any moment regardless of what the broad market does. To reiterate the three core points of our Tesla short position:

JamesQube / Pixabay

1) Tesla has no “moat” of any kind; i.e., nothing meaningfully or sustainably proprietary.

2) Tesla loses a huge (and increasing) amount of money despite relatively light competition but will soon be confronted with massive competition in every aspect of its business.

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3) Elon Musk is extremely untrustworthy.

In Tesla’s long history of insane events, August had to be the most insane month ever, thanks to a completely fictional series of tweets Musk posted about a supposed $420/share bid to take the company private, thereby triggering an onslaught of lawsuits (and a billion-dollar plus liability), an SEC investigation (on top of an existing SEC investigation which may be preventing the company from raising desperately needed capital), and a tearful interview with the NY Times in which a guy living on a $72 million estate and commuting to work in a G650ER confessed to extensive drug use, admitted his “go private tweets” were a fabrication, and—being the pathological liar that he is—couldn’t even avoid lying in this “confessional interview” when he said that after attending his brother’s June wedding in Spain he immediately flew back to Tesla’s factory when in fact he spent several more days partying in Spain before flying to Ireland to visit the set of “Game of Thrones”, a fictional series comprised of devious, murderous characters who collectively have “a magnitude” (to use a favorite Musk expression) more integrity than the CEO of Tesla.

(As an aside, for those of you who still fantasize about a Tesla go-private deal at the roughly $80 billion fully-diluted enterprise value that Musk’s fictional Tweet implied, keep in mind that this fall nicely profitable Volvo—with a great brand selling 2x as many cars as Tesla and multiple upcoming electric models-- plans to IPO later this year at a valuation of $30 billion.)

Concurrent with the Musk “fake go-private craziness,” Tesla safety and financial whistleblower Martin Tripp posted on Twitter a substantial amount of damning photographic evidence before deleting his account the next day at the behest of his lawyer, and then the next day a new whistleblower emerged, accusing Tesla of illegally wiretapping its employees and failing to report the theft of $37 million of raw materials (as well as—presumably non-deliberately—employing a substantial drug trafficker).

Early in August Tesla released a horrendous Q2 financial report, showing a GAAP loss of $717 million and free cash flow of negative $812 million, forcing a major slash in projected 2018 capex for this manufacturing-intensive alleged “hyper-growth company.” (And recall that in July a memo leaked to the Wall Street Journal revealed that Tesla is so hard-up for money that it’s begging its suppliers for retroactive rebates, calling the needed cash “essential to its continued operation.”) On the Q2 conference call following the earnings release there were multiple anomalies and inconsistencies; Seeking Alpha published an excellent summary of several of them, and here’s a good summary of the 10-Q. And regarding those 5000 Model 3s Musk bragged about producing during the last week of the quarter, have a look at this. Meanwhile (courtesy of Twitter user @temp_worker) the most “exponential growth” at Tesla may be the number of mechanic’s liens filed against it:

Also in the Q2 earnings release was Tesla’s claim that that it will be GAAP profitable in Q3 & Q4 barring (and Musk said this on the call three times, as if he was trying to tell us something) a “force majeure.” However, I’ve run numbers every which way I can and the best I can come up with for Q3 is a GAAP loss of somewhere between $100 million and $300 million depending on the market for ZEV credits, and—as Models S&X demand continues to erode (see below) and a flood of competing EVs erodes the ZEV credit market—Q3 will be the best future quarter Tesla ever sees. Here’s a similar conclusion from one of the best Tesla analysts on Seeking Alpha.

Perhaps the most important ongoing Tesla story is the seeming evaporation of North American Model 3 backlog, at least for the versions currently being sold with a starting price of $50,000. Tesla has now abandoned its “reservation list” and thrown open orders to all comers while (as evidenced in on-line forums) reducing the delivery time to as little as one to two weeks, and fresh credit card data from research firm Second Measure indeed shows Model 3 demand to be a disaster, and here’s a great new overview from Seeking Alpha indicating the same. In fact, in July two giant lots in California were discovered holding thousands of Model 3s baking in the sun, some of which were covered with dust and seemingly unmoved for weeks. And this excess inventory is piling up despite the fact that-- according to a new leak given to Tesla fanboy blog Electrek-- Tesla is suffering through a Q3 Model 3 production miss.

Keep in mind too that after December 31st the Model 3’s (and all Teslas’) $7500 tax credits will be cut to $3750 for six months, then $1875 for six months, and then goes away completely. As this realization sinks into the minds of those awaiting the mythical $35,000 base-priced Model 3 (a car delayed multiple times already and now unavailable at least until the second half of 2019, if ever), look for an onslaught of additional reservation cancellations, as hinted in this fine article from the L.A. Times.

Meanwhile, the Model 3 continues to reveal itself to be a complete lemon; the latest survey from True Delta ranks it dead last among all available vehicles! In fact, even Musk finally admits the cars have a quality problem—good luck making money running a car company like this:

 

And when you do need service (and you will, regularly!) good luck getting it, with multi-week waits for appointments and multi-month waits for parts! And remember, almost nothing can be done in the Model 3 without a multi-step process on the touchscreen—not even changing the windshield-wiper speed, adjusting the air vents or opening the glovebox. Thus, operating a Tesla Model 3 may potentially be as dangerous as texting while driving.

And keep in mind that 2018 is showing a year-to-date decline in Model S&X sales vs. 2017, even before the widespread availability this September of the new Jaguar I-Pace electric SUV which received fabulous reviews (and handily beats Tesla in comparison tests) and is $13,000 cheaper than the Model X and $7000 less than the Model S, gaps that will widen substantially as Tesla’s tax credits phase out. In fact I drove the Jaguar yesterday and I can assure you that no one who drives it will say it isn’t much nicer than any Tesla:

 

And the Models S&X sales decline is also occurring before the near-term introduction of an onslaught of other luxury EVs in addition to the Jag—the Audi e-tron to be formally unveiled in September and available in Europe this winter and the U.S. next spring, the Mercedes EQC, also to be unveiled in September and available next spring, and the Porsche Taycan (previously called the Mission E), available late 2019. And all those cars (except the Porsche) will be priced significantly less expensively than the comparable Tesla even before their U.S. buyers enjoy the $7500 tax credit that will soon expire for Tesla, while the Porsche’s base price will be similar to that of the base Tesla Model S. Hmmm, Tesla or Porsche… tough choice!

Meanwhile Tesla continues to downsize its SolarCity division while a securities fraud case accusing Musk of using Tesla to bail out his (and his family’s) interests there proceeds; Zero Hedge included an excellent summary of the suit by Twitter user @TeslaCharts in this story about SolarCity’s latest retrenchment, which will undoubtedly help fuel that fraud case, as will this later story describing how Tesla sales people have no idea when the solar tiles or PowerWalls used to justify that merger will ever be available. (Remember that when Musk was promoting that merger he used fake solar tiles on a fake house at a movie studioHow appropriate!)

And hey, remember when Musk called the heroic Thai cave diver a “pedo” after the guy said Musk’s stupid “mini-sub” was useless? You probably thought that incident was over (and so did I!), but with Musk the fun never ends—he revived the feud a few days ago on Twitter:

 

Well guess what, Elon? He is suing you!

Meanwhile, Tesla is increasingly besieged by a wide variety of lawsuits for securities fraud, labor discrimination, worker safety, union-busting, sudden acceleration and lemon law violations, and new ones appear on a regular basis, while the list of departing executives is so long that Jim Chanos recently said that the only other times he’d seen anything like it was during the waning days of Enron and Valeant. Congratulations, Tesla: you’re a company in great company!

So here is Tesla’s competition in cars (note: these links are continually updated)…

Jaguar Electric IPace SUV Available Summer 2018

2019 Jaguar XJ to be reborn as high-tech electric flagship

Jaguar Land Rover will boost spending to $18 billion to fund EVs

2019 Audi E-Tron To Charge Faster Than Tesla Supercharger Network

Audi e-tron Sportback in 2019 to be its second EV

The 2019 Porsche Taycan

Porsche Cross Turismo to be its second EV

Mercedes 2019 EQC To Be Unveiled This September

Mercedes Plans Electric S-Class to Challenge Tesla’s Flagship

Mercedes Wheels Out Electric Car Roadmap, Car And Battery Factories Everywhere

2019 Hyundai Kona Electric gets 250-mile range rating in the U.S.

14 new EV models by Hyundai-Kia by 2025

Chevrolet Bolt Offers 238 Miles On A Single Charge For $37,495

GM to introduce 3 more electric cars before 2020, battery cells at <$100/kWh

2018 Nissan Leaf: 150 miles for $30,875, 200+ mile model by late 2018

Nissan Leaf-based SUV coming in 2020

Volvo Polestar 2: 350-mile range, £30,000 starting price

Volvo To Start Selling Electric Trucks In 2019, Some Will Hit The Road This Year

VW will build EVs in 16 factories in zero emissions push

Volkswagen I.D. Crozz 311-Mile Electric CUV For $30,000-ish Before Incentives

VW’s All-Electric I.D. Vizzion Coming With 400 Miles of Range

BMW will export iX3 electric SUV to Europe, U.S. from China

BMW Confirms The i4 EV

BMW to have 25 electrified models by 2025

Ford plans $11 billion investment, 40 electric vehicles by 2022

Toyota, Mazda, Denso create company to roll out electric cars beginning 2019

Toyota to market over 10 battery EV models in early 2020s

Infiniti will go mostly electric by 2021

PSA will launch full-electric Peugeot 208 and DS 3 Crossback in 2019

ALL-ELECTRIC MINI COOPER COMING IN 2019

Smart Will Electrify Its Entire Line-up By 2020

SEAT's first electric car is due in 2020

Opel will launch full electric Corsa in 2020

2019 Skoda e-Citigo confirmed as brand's first all-electric model

Skoda planning range of hot all-electric eRS models

MG E-Motion confirms new EV sports car on the way by 2020

Aston Martin to create all-electric car brand

Fiat Chrysler bets on electrification for Alfa, Jeep and Maserati

Maserati to take on 'Porsche and Tesla' with Alfieri, new SUV and four EVs

Renault prepares to double production of Zoe EV

Rolls-Royce is preparing electric Phantom for 2022

Citroen preparing EV push with 80 per cent electrified range by 2023

Honda will offer full-EV or hybrid tech on every European model by 2025

All-electric Bentley four-door coupe to use EV tech from Porsche Mission E

Subaru to introduce all-electric vehicles by 2021

Ssangyong e-SIV concept previews 2020 EV

Dyson Moves Ahead on $2.6 Billion Electric Car Plan

235mph Lucid Air due in 2019 as electric BMW 7 Series rival

Borgward BXi7 Electric SUV Flies Under The Radar

Detroit Electric promises 3 cars in 3 years

SF Motors reveals two electric SUVs for 2019 with 300 miles of range

Two new electric cars from Mahindra in India by 2019; Global Tesla rival e-car soon

Saab asset owner NEVS plans electric car production

EVelozcity Raises $1 billion For EV Startup

Flush with new cash, electric-car company Faraday Future hopes for a fresh start

And in China…


Top of Form

Bottom of Form

Daimler & BYD launch new DENZA electric vehicle for the Chinese market

BAIC and Daimler to Build $1.9 Billion China Plant

Daimler and Baidu to Enhance Strategic Cooperation in Automated Driving

Volkswagen makes €15bn bet on electric cars in China

Volkswagen Group China’s mega-factory in Foshan will strengthen e-mobility strategy in China

VW signs deals for EVs, autonomous driving in China

Audi to launch 7 new energy vehicle models in China by 2020

GM China raises new-energy vehicle target to 20 models through 2023

Nissan & Dongfeng to invest $9.5 billion in China to boost electric vehicles

Toyota to Introduce 10 New Electrified Vehicles in China by 2020

Infiniti bringing EVs to China’s luxury car market

BMW will develop and produce electric Mini in China

Ford ramps up electric vehicle push in China

China's BYD tops global electric-car production for third year in a row

SAIC to spend $2.2 billion on EVs, connectivity, aftersales services

Honda debuts Everus electric car for China

Changan building large scale NEV factory

Mazda and Changan Auto join hands on electric vehicles

WM Motors/Weltmeister EX5 Electric SUV Launched On The Chinese Car Market

NIOS ES8 Electric Crossover debuts with half the Tesla Model X’s price tag

Geely invests $5 billion into new electric car factory in China

Chery Breaks Ground on $240M EV Factory in China

Chery's second EV plant open in Dezhou

Leapmotor’s electric car to hit the market in 2018

Alibaba-backed Xiaopeng Motors to raise US$2.7 billion this year

GAC Trumpchi to launch range-extended EVs

Guangzhou Auto To Launch Four New Electric Cars By 2020

Chinese carmaker Byton unveils its fully autonomous rival to Tesla's electric sedans

Chinese-backed electric car start-up Byton woos CES with model 40% cheaper than a Tesla

Great Wall Launches New EV Brand (ORA) In China

Singulato iS6 Electric SUV Debuts With 249-Mile Range

Singulato, BAIC partner to promote smart new energy vehicles

FAW (Hongqi) to roll out 15 electric models by 2025

JAC’s Electric Car Has A Range Of 500 Kilometers

ICONIQ to build electric cars in Zhaoqing with total investment of RMB 16 billion

Quianu Motor aims to grab share of US electric vehicle market

All-electric NEVS 9-3 sedans (nee Saab) being built in China

Youxia Motors raises $1.25 billion to start 2019 EV production

Wanxiang Gets China Electric Vehicle Permit to Make Karma Cars

Qoros Auto's new owner plans to be an EV power

JMC (Jianling Motor Corp.) Starts New EV Brand In China

Thunder Power electric cars at the Frankfurt motor show

Continental, Didi sign deal on developing EVs for China

Here’s Tesla’s competition in autonomous driving…

Tesla Ranks Last for Automated Driving

A Tesla self-driving blind spot that few are focusing on

Waymo is first to put fully self-driving cars on US roads without a safety driver

Jaguar and Waymo announce an electric, fully autonomous car

Waymo Expands Chrysler Self-Driving Fleet 100-Fold to 62,000

Uber, Waymo in talks about self-driving partnership

Lyft and Waymo Reach Deal to Collaborate on Self-Driving Cars

Cadillac Super Cruise™ Sets the Standard for Hands-Free Highway Driving

GM ride-hailing fleet would ditch steering wheel, pedals in 2019

SoftBank Vision Fund to Invest $2.25 Billion in GM Cruise

An Overview of Audi Piloted Driving

Updated 2017 Mercedes-Benz S-Class - first ride with autonomous technology

Nvidia to test fleet of robotaxis in 2019 with Daimler, Bosch

NVIDIA and Toyota Collaborate to Accelerate Market Introduction of Autonomous Cars

Volkswagen and NVIDIA to Infuse AI into Future Vehicle Lineup

Continental & NVIDIA Partner to Enable Production of Artificial Intelligence Self-Driving Cars

Bosch and Daimler join forces to market fully automated, driverless taxis by 2020

Intel’s Mobileye will have 2 million cars (VW, BMW & Nissan) on roads building HD maps in 2018

Volkswagen Group and Aurora Innovation Announce Strategic Collaboration On Self-Driving Cars

Toyota, Intel and others form big data group for autonomous tech

Toyota Adds $2.8 Billion to Software Push for Self-Driving Cars

Toyota Invests $500 Million in Uber to Get Self-Driving Cars on the Road

Nissan’s Robo-Taxis Will Hit the Road in March

Nissan and Mobileye to generate, share, and utilize vision data for crowdsourced mapping

Magna joins the BMW Group, Intel and Mobileye platform as an Integrator for AVs

Intel collaborates with Waymo on self-driving compute design

Fiat Chrysler to Join BMW, Intel and Mobileye in Developing Autonomous Driving Platform

Ford-Backed Driverless-Car Startup Argo AI Lures Talent

Ford to invest $4 billion in new self-driving vehicle unit

Lyft, Aptiv (formerly Delphi) partner on driverless ride-hailing at 2018 CES in Vegas

Lyft, Magna in Deal to Develop Hardware, Software for Self-Driving Cars

Hyundai, Aurora to release autonomous cars by 2021

Deutsche Post to Deploy Test Fleet Of Fully Autonomous Delivery Trucks This Year

Byton cooperating with Aurora on autonomous vehicles

Magna’s new MAX4 self-driving platform offers autonomy up to Level 4

Bosch Creates a Map That Uses Radar Signals for Automated Driving

Honda Targeting Level 3 Automated Driving By 2020, Level 4 by 2025

Groupe PSA’s safe and intuitive autonomous car tested by the general public

Baidu unveils autonomous driving platform backed by 90 global partners

Baidu plans to mass produce Level 4 self-driving cars with BAIC by 2021

BlackBerry and Baidu Partnering to Accelerate Connected and Autonomous Vehicle Technology

Tencent, Changan Auto Announce Autonomous-Vehicle Joint Venture

JD.com Delivers on Self-Driving Electric Trucks

NAVYA Unveils First Fully Autonomous Taxi

Fujitsu and HERE to partner on advanced mobility services and autonomous driving

Lucid Chooses Mobileye as Partner for Autonomous Vehicle Technology

First Look Inside Zoox’s Autonomous Taxi

Apple Is Focusing on Making an Autonomous Car System

Samsung, Harman gear up for self-driving automobiles

Mitsubishi Electric Develops Automated Mapping For Autonomous Driving

Hitachi demonstrates vehicle with 11-function autonomous driving ECU

DENSO and NEC Collaborate on Automated Driving and Manufacturing

Nuro’s Robot Delivery Vans Are Arriving Before Self-Driving Cars

Here’s Tesla’s competition in car batteries…

LG Chem targets electric car battery sales of $6.3 billion in 2020

LG Chem to build $1.8 bln EV battery plant in China

Samsung SDI Unveils Innovative Battery Products at 2018 Detroit Motor Show

SK Innovation building 20GWh of worldwide battery manufacturing capacity

New Toshiba EV Battery Allows 320km Charge in 6 Minutes

Daimler building eight battery factories

Panasonic Opens New Automotive Lithium-Ion Battery Factory in Dalian, China

Panasonic forms battery partnership with Toyota

CATL’s Chinese battery factory will be bigger than Tesla’s Gigafactory

CATL to set up battery cell manufacturing in Germany

BYD to quadruple car battery output with lithium site plants

GM inaugurates battery assembly plant in Shanghai

Honda Partners on General Motors' Next Gen Battery Development

VW Wants to One-Up Tesla With a Next-Generation Battery

Energy Absolute Plots Asian Project Rivaling Musk's Gigafactory

European Battery Alliance (EBA) is taking shape

ABB teams up with Northvolt on Europe's biggest battery plant

Chinese Battery Maker to Open Factory Next to Swedish EV Plant

Sokon aims to be global provider of battery, electric motor, electric control systems

BMW Group invests 200 million euros in Battery Cell Competence Centre

BMW Brilliance Automotive opens battery factory in Shenyang

BMW announces partnership with solid-state battery company

Toyota promises auto battery 'game-changer'

VW increase stake in solid-state batteries with $100M investment

Hyundai Motor developing solid-state EV batteries

Continental eyes investment in solid-state batteries

Wanxiang is playing to win, even if it takes generations

UK provides millions to help build more electric vehicle batteries

Rimac is going to mass produce batteries and electric motors for OEMs

Elon Musk Has A New Battery Rival (Romeo Power) Packed With His Ex-Employees

Bracing for EV shift, NGK Spark Plug ignites all solid-state battery quest

ProLogium Technology Will Produce First Next Generation Lithium Ceramic Battery For EVs

Here’s Tesla’s competition in storage batteries…

Panasonic

Samsung

LG

BYD

AES + Siemens (Fluence)

GE

Bosch

Mitsubishi Hitachi

NEC

Hitachi Chemical

Toshiba

ABB

Saft

Johnson Contols

EnerSys

SOLARWATT

Schneider Electric

sonnenBatterie

Kokam

Sharp

Eaton

Nissan

Tesvolt

Kreisel

Leclanche

Lockheed Martin

EOS Energy Storage

ESS

UniEnergy Technologies

electrIQ Power

Belectric

Sunverge

Stem

ENGIE

Exergonix

Redflow

Renault

Fluidic Energy

Primus Power

Simpliphi Power

redT Energy Storage

Murata

Bluestorage

Adara

Blue Planet

Clean Energy Storage Inc.

Swell Energy

Tabuchi Electric

Younicos

Orison

Moixa

Powin Energy

Nidec

Powervault

Schmid

24M

Terra E

Eelpower

Ecoult

And here’s Tesla’s competition in charging networks…

Electrify America: Our Plan

EVgo Installing First 350 kW Ultra Fast Public Charging Station In The US

Tritium’s First 350-kW DC Fast Chargers Coming To U.S.

Porsche plans network of 500 fast chargers for U.S.

BMW, Daimler, Ford, VW, Audi & Porsche form IONITY European 350kw Charging Network

E.ON to have 10,000 150KW TO 350KW EV charging points across Europe by 2020

Enel kicks off the E-VIA FLEX-E project for the installation of European ultra-fast charging stations

Europe’s Allego “Ultra E” ultra-fast charging network now operational

Allego & Fortum Launch MEGA-E High Power Charging network for Europe’s Metropolitan areas

Chargepoint Europe Gets $82 million in new funding from Daimler

ChargePoint - InstaVolt partnership; more than 200 UK rapid charge systems

UK's Podpoint installing 150kW EV rapid chargers this year; 350kW by 2020

UK National Grid plans 350kW EV charge point network

ChargePoint Express Plus Debuts: Offers Industry High 400 kW DC Fast Charging

Fastned building 150kw-350kw chargers in Europe

ABB powers e-mobility with launch of first 150-350 kW high power charger

Shell buys European electric vehicle charging pioneer NewMotion

BP buys UK's largest car charging firm Chargemaster

Total planning EV charging points at its French stations

Yet despite all that deep-pocketed competition, perhaps you want to buy shares of Tesla because you believe in its management team. Really???

Elon Musk, June 2009: “Tesla will cross over into profitability next month”

Tesla SEC Correspondence Shows A Pattern Of Inaccurate, Incomplete & Misleading Disclosures

Tesla: Check Your Full Self-Driving Snake Oil Expiration Date

As Musk Hyped and Happy-Talked Investors, Tesla Kept Quiet About a Year-Long SEC Probe

The Truth Is Catching Up With Tesla

With Misleading Messages And Customer NDAs, Tesla Performs Stealth Recall

Who You Gonna Believe? Elon Musk's Words Or Your Own Lying Eyes?

How Tesla and Elon Musk Exaggerated Safety Claims About Autopilot and Cars

When Is Enough Enough With Elon Musk?

Musk Talked Merger With SolarCity CEO Before Tesla Stock Sale

Debunking The Tesla Mythology

Tesla Continues To Mislead Consumers

Tesla Misses The Point With Fortune Autopilot Story

Tesla Timeline Shows Musk's Morality Is Highly Convenient

Tesla Scares Customers With Worthless NDAs, The Daily Kanban Talks To Lawyers

Tesla: Contrary To The Official Story, Elon Musk Is Selling To Keep Cash

Tesla: O, What A Tangled Web We Weave When First We Practice To Deceive

I Put 20 Refundable Deposits On The Tesla Model 3

Tesla's Financial Shenanigans

Tesla: A Failure To Communicate

Can You Really Trust Tesla?

Elon Musk Appears To Have Misled Investors On Tesla's Most Recent Conference Call

Understanding Tesla’s Potemkin Swap Station

Tesla's Amazing Powerwall Reservations

So in summary, Tesla is losing a massive amount of money even before it faces a huge onslaught of competition (and things will only get worse once it does), while its market cap tops that of Ford and GM despite a $2.8 billion+ annualized net loss selling approximately 200,000 cars while Ford and GM make billions of dollars selling 6.6 million and 9 million cars respectively. Thus this cash-burning Musk vanity project is worth vastly less than its over $60 billion fully-diluted enterprise value and—thanks to its roughly $31 billion in debt and purchase obligations—may eventually be worth “zero.”