This will be my last post on this cash topic, and then I will hold my peace!
There are several posts in response to my posts. I am only responding to
@DaveT (to conserve bandwidth and also) because we started off the discussion on the same basis. That mid Q1 went through cash crisis and mid Q2 might as well.
I was very specifically talking about Equity, Debt and Convertible debt. That's what the table earlier I posted captured... The other kind of debt like secured debt, syndicate bank loans, and credit facilities are lot more nuanced.
The financing that Tesla got for Shanghai GF is with as many hand-cuffs as one can get. Proceeds can only be used for the Shanghai factory, comes with a very tight deadline, the financing is provided in increments based on milestones. This is not some cash that fell in Tesla's lap that they can use willy nilly for anything.
Somewhat broadly speaking increase in Credit facilities and secured debt is to provide support for growing operations. They are not meant to finance losses or pay off debts. You get to finance loses or pay debt by doing equity/debt raises.
More fundamentally, you can't say both these statements and both be valid a) Tesla went through cash crunch b) Tesla had adequate access to capital.
Maybe just poor timing and unexpected confluence of events that got management off guard is your point. Maybe it is. I just have a hard time seeing that way.
"he thought Tesla didn't need to, which proved to be true during the duration of 2018"
I don't agree with this.
2018 was a total sh- show. Tesla got by 2018 by cutting capex to the bone, acutely under investing in delivery logistics, under-investing in service infrastructure. Basically cutting every expense down - remember, that memo where Musk asked that every expense >1mil be personally approved by him?
I mean think about this, they were delivering cars in parking lots off Target and McDonalds. That's seriously disrespectful... Paper work was all over the place. People got resecheduled every which way. Taking even 4 attempts. Did Apple ever do this, despite 50 to 100 fold unit volumes? Even Macy's in holiday season doesn't bahave that badly. They are just selling shoes and underwear! Macy's simply hires excess temp staff during the holiday season. Musk called on fans to help out! (lol).
For instance, why isn't Semi in production? or atleast why didn't some preparatory steps happen? Perhaps it's because Tesla didn't have cash for associated Capex?
If the point is to burn down the brand, amputate product lines, derail development - and then turn around and say - hey, look, Musk won the argument. He didn't need the capital, just like he said.
Well, fine, Musk wins the argument but loses the battle.
All in all, most folks point here is that Tesla didn't need capital nor it tried to access capital. Thus it can't be proved that they are somehow "blocked" from capital access.
My point is - all of Tesla's actions point to dire need for capital. Instead of raising capital, it did extreme maneuvering. Price of which is showing up now in terms of bad reputation and thus incrementally lower demand. Was this simply a strategic mistake or was this some form of "block"? That remains to be seen.
Meanwhile: here is a snippet from Adam Jonas this morning "If and how Tesla may have access to capital is a top theme in discussions with investors, the analyst said"
This is not as much of a conspiracy as one might think.
