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How Tesla became debt free while legacy manufactures are swimming in extreme debt


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  • Gold Member

Tesla is going to force the legacy automakers into another bailout.  They are already driving Chinese automakers out of business or into consolidation schemes with just one factory in China.


https://www.gurufocus.com/news/1963828/tesla-and-debt-a-masterclass-for-the-auto-industry

https://cleantechnica.com/2023/03/24/how-tesla-became-debt-free-in-just-two-decades/

Tesla has become nearly debt-free in just two decades, a feat that’s unheard of in the auto industry’s more-than-century-old history. 
 

Guru Focus writer Matthew Cobb breaks down how Tesla’s debt compares to those of the two largest U.S. automakers, GM and Ford, showing that both of the legacy manufacturers are swimming in debt. Meanwhile, Tesla could pay off its remaining debt tomorrow if it wanted to.

Currently, Ford has a total long-term debt of $140 billion, while GM is right behind with $115 billion in the same category. Tesla, on the other hand, has just $5 billion in long-term debt, and plenty of cash to show for. In fact, the company has $22 billion in free cash flow, meaning that its cash minus debt gives it a $17 billion surplus.

 

           Ford

        GM         

Tesla         

Total Long Term Debt

$140 Billion

$115 Billion

$5 Billion

Market Cap

$48.23 Billion

$50.93 Billion

$548 Billion

Total Sales

$158 Billion

$156 Billion

$81 Billion

Cash Available

$44 Billion

$31 Billion

$22 Billion

Debt Minus Cash

$94 Billion

$84 Billion

$17 Billion SURPLUS in Cash

Edited by BOHICA
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  • Gold Member

Tesla is massively subsidized by the government
 

Tesla has received more than $3.2 billion worth of direct and indirect California subsidies and market mechanisms since 2009
 

The White House on Wednesday announced that Tesla, with the support of $7.5 billion in government subsidies, will open a portion of its U.S. Supercharger and Destination Charger network to non-Tesla EVs

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  • Gold Member
2 hours ago, 800renegaderider said:

Tesla is massively subsidized by the government
 

Tesla has received more than $3.2 billion worth of direct and indirect California subsidies and market mechanisms since 2009
 

The White House on Wednesday announced that Tesla, with the support of $7.5 billion in government subsidies, will open a portion of its U.S. Supercharger and Destination Charger network to non-Tesla EVs

Massive debt even after being bailout at taxpayers expense a few times now.  Tesla would be 100 percent debt free with a 5 billion dollar check.  GM and Ford are going defunct….  That debt is not sustainable that they both carry. 

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5 minutes ago, BOHICA said:

Massive debt even after being bailout at taxpayers expense a few times now.  Tesla would be 100 percent debt free with a 5 billion dollar check.  GM and Ford are going defunct….  That debt is not sustainable that they both carry. 

Tesla's plant in California is the old Toyota/GM joint venture that Tesla got for pennies on the dollar.  Tesla would not be in such great shakes if it did not have the bones of the US car business to pick over. 

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  • Gold Member
3 hours ago, BOHICA said:

Massive debt even after being bailout at taxpayers expense a few times now.  Tesla would be 100 percent debt free with a 5 billion dollar check.  GM and Ford are going defunct….  That debt is not sustainable that they both carry. 

“Without taxpayer support, however, neither Tesla nor SpaceX would have survived this long”


thanks tax payers for keeping Tesla alive

B624D33C-71AD-46CD-B05B-4B1249172B27.png

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I remember when the auto bailouts were getting debated why the big 3 couldn't compete with the Japanese.  At the time there was something like 2500.00 in legacy costs per car that Japan didn't have. That's why the quality was so much better. 

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8 hours ago, Art Vandelay said:

Yep, Elon has played the handout game better than anyone.

Did Elon play the handout game or did our Govt through tax policy create the vacuum.

Chicken or the Egg?

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  • Gold Member
10 hours ago, 800renegaderider said:

“Without taxpayer support, however, neither Tesla nor SpaceX would have survived this long”


thanks tax payers for keeping Tesla alive

B624D33C-71AD-46CD-B05B-4B1249172B27.png


 

Looks like Ford and GM can thank the taxpayer as well by looking at that chart.

Those 2 make 10 times less EV combined then Tesla does and combine tax payer help looks to be as much if not more combined then Tesla.  Throw in the bailouts of BushObama and they get a lot of coin from the gov.  Neither GM,Ford,or Stellantis USA would exist with out the 2008-2012 tax payer gift

 

Edited by BOHICA
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41 minutes ago, SkisNH said:

I remember when the auto bailouts were getting debated why the big 3 couldn't compete with the Japanese.  At the time there was something like 2500.00 in legacy costs per car that Japan didn't have. That's why the quality was so much better. 

At tghe time of the bailout, for every 2 workers, GM had 3.7 retirees on the books

Edited by steve from amherst
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7 minutes ago, steve from amherst said:

At tghe time of the bailout, for every 2 workers, GM had 3.7 retirees on the books

Sounds just like our local school district.  Taxes through the roof and the young teachers starting out cry they make peanuts.  Well, look down the road after you retire and see what you'll be working for someday.  Not today, but someday.

Wonder what a retired auto worker's pension amounts to?  It's gotta look pretty sweet, and starting out at the age of what, 52?  55?  58?

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GM pulled the plug on pick up truck production. They currently have 100 days of inventory sitting on the lots with no buyers. The goal of companies in post pandemic times is to supply only 40-50 days of product. Most people can't afford new vehicles. It's going to get really ugly out there. 

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  • Gold Member
5 minutes ago, spin_dry said:

GM pulled the plug on pick up truck production. They currently have 100 days of inventory sitting on the lots with no buyers. The goal of companies in post pandemic times is to supply only 40-50 days of product. Most people can't afford new vehicles. It's going to get really ugly out there. 

Pile of inventory in my area….  Ram has some good size discounts going.  Ford and GM seem to be holding off the large discounts.  Those that got bent over by dealers with dealer markups the past few years are in a pretty tough spot.

 

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2 minutes ago, BOHICA said:

Pile of inventory in my area….  Ram has some good size discounts going.  Ford and GM seem to be holding off the large discounts.  Those that got bent over by dealers with dealer markups the past few years are in a pretty tough spot.

 

Demographics of the Tesla buyer is what's keeping their sales higher. High income and older. That's getting stretched by the day. It's one of the reasons the price of a used Tesla has collapsed. High income buyers want new. The prices have somewhat stabilized for now, but it's something that no doubt is concerning to Musk. 

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  • Gold Member
5 minutes ago, spin_dry said:

Demographics of the Tesla buyer is what's keeping their sales higher. High income and older. That's getting stretched by the day. It's one of the reasons the price of a used Tesla has collapsed. High income buyers want new. The prices have somewhat stabilized for now, but it's something that no doubt is concerning to Musk. 

Biggest reason Tesla used have come down is 3 parts. Biggest is price drop, 2 is tax credit and 3 is softening market.  I think last data that the back log for tesla on orders has increased since the beginning of the year…..  up over 100,000 backlog orders

The Tesla dealership in my town late last year had about 20-25 new cars in inventory to sell.  Now they have zero model 3’s, one new Y, 1 demo S and 2 X’s which one is a demo

 

The 3 is an extreme bargain if you have at least $7500 in income tax liability.  The Y also is a bargain currently.

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1 minute ago, BOHICA said:

Biggest reason Tesla used have come down is 3 parts. Biggest is price drop, 2 is tax credit and 3 is softening market.  I think last data that the back log for tesla on orders has increased since the beginning of the year…..  up over 100,000 backlog orders

The Tesla dealership in my town late last year had about 20-25 new cars in inventory to sell.  Now they have zero model 3’s, one new Y, 1 demo S and 2 X’s which one is a demo

 

The 3 is an extreme bargain if you have at least $7500 in income tax liability.  The Y also is a bargain currently.

That $7500 means nothing to most middle class buyers. Teslas remain a vehicle for upper middle to upper economic class. Repair costs on the used models out of warranty is frightening. 

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  • Gold Member
7 minutes ago, spin_dry said:

That $7500 means nothing to most middle class buyers. Teslas remain a vehicle for upper middle to upper economic class. Repair costs on the used models out of warranty is frightening. 

About $67,000 on a single filer doing standard deduction to have $7500 in tax liability.  Well under 40k and they are in a model 3 after tax credit.  Model 3 is the middle class preferred luxury car

 

Millenials and younger prefer Tesla over any other car brand.  

Tesla market share and sales will increase this year. Compared to previous years.

Edited by BOHICA
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4 minutes ago, BOHICA said:

About $67,000 on a single filer doing standard deduction to have $7500 in tax liability.  Well under 40k and they are in a model 3 after tax credit.  Model 3 is the middle class preferred luxury car

 

Millenials and younger prefer Tesla over any other car brand.  

Tesla market share and sales will increase this year. Compared to previous years.

A single filer making $67k ought not be purchasing a vehicle carrying that type of loan. Couple that with the current interest rates. That’s totally ridiculous. Here’s Tesla buyer demographics  

https://hedgescompany.com/blog/2019/03/tesla-model-3-demographics-income/#demographics_of_tesla_model_3_owners_average_income

 

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  • Gold Member
10 minutes ago, spin_dry said:

A single filer making $67k ought not be purchasing a vehicle carrying that type of loan. Couple that with the current interest rates. That’s totally ridiculous. Here’s Tesla buyer demographics  

https://hedgescompany.com/blog/2019/03/tesla-model-3-demographics-income/#demographics_of_tesla_model_3_owners_average_income

 

Yep.  2 school teachers in a house worth of income is a model 3 buyer.

but a $67k filer shouldnt be in any car…  gas, oil, and combustion car maintenance is a huge expense

https://www.businessinsider.com/typical-tesla-driver-owner-income-age-careers-demographics-2022-10?amp

Edited by BOHICA
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  • Gold Member
7 hours ago, BOHICA said:

Yep.  2 school teachers in a house worth of income is a model 3 buyer.

but a $67k filer shouldnt be in any car…  gas, oil, and combustion car maintenance is a huge expense 

https://www.businessinsider.com/typical-tesla-driver-owner-income-age-careers-demographics-2022-10?amp

:lol:

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