schonelucht
Well-Known Member
Growing liabilities are not necessarily a sign of trouble; and no, Tesla is not systematically "holding payment," they just had a dispute with a supplier, which all companies go through. Tesla's negative cash cycle will allow the company to generate cash while it grows.
Unfortunately, due to the slower ramp of the Model 3 this will stay much more subdued than imagined at first where they'd ramp for a few hunderds to thousands in a matter of weeks. Here is how they described it in the latest conference call
Tesla Q4 said:Deepak Ahuja - Tesla, Inc.
We got to look at it from a full quarter perspective. The negative working cycle is amplified by the rate at which we ramp our production, given our present plans of getting to 5,000 by end of Q2. It's a fairly gradual – it's exponential from where we started, but it's not going to create a situation where our cash flow from operations will exceed CapEx.
He's a bit diffuse here since he was asked to compare it with capex, but I take the overall message as being that this will not count for much.
I am trying to make a 'cash events' timeline for the next 12 months and at this point I am just rolling it into the regular increase in accounts payable that we've now had many quarters in a row.