Tesla Turns To Suppliers To Help It Become Profitable

Tesla Turns To Suppliers To Help It Become Profitable

The company, which has already tapped the debt and equity markets for much-needed cash, turned recently to some suppliers for "meaningful" rebates on payments made to them since 2016, according to a report. It is spending about $1 billion a quarter as it ramps up manufacturing of the Model 3 sedan, a lower-priced vehicle that is key to Tesla's plans of becoming a major mass-market automaker.

Musk, Tesla's co-founder and CEO, confirmed on Twitter that Tesla is asking for money from its suppliers. According to a leaked memo, the company is requesting money back from suppliers to help the auto company become profitable, as if this is the responsibility of the company's suppliers.

The race to get the Model 3 going may have added unexpected costs in the second quarter.

"This is troubling for us to hear", said Morningstar analyst David Whiston in a note to clients.

In June, Tesla said it was cutting several thousand jobs to become sustainable profitable without endangering the ramp-up of Model 3 production. The stock is down from a peak of $385 in September, with many investors growing concerned about Tesla's spending and its ability to meet its production goals.

North Korean Economy Suffered Sharpest Drop In 2 Decades, South Says
Earlier this month, US Secretary of State Mike Pompeo visited North Korea and held discussions on North Korea's denuclearisation. Delattre said it was important to avoid "any premature signal of a loosening of sanctions that would be a counter-message".

As a refresher, Musk told Bloomberg: "Once we break through to mass-market cars, where mass-market is on the order of a quarter million vehicles per year, I can not see us doing a 1.2-million-vehicle program of one particular model".

Still, industry analysts said it is unusual for carmakers to request refunds for two previous years, as Tesla has demanded.

Tesla shares have fallen sharply after it was revealed the electric carmaker is seeking refunds from some suppliers.

Musk has said he won't need to raise cash this year, but some analysts have doubts.

Tesla burned through more than $700 million in the first quarter - leaving it with $2.7 billion cash on hand. "It's simply ludicrous and it just shows that Tesla is desperate right now", he said. The company also has taken $1,000 deposits for Model 3 orders to help fund development and manufacturing, which established carmakers don't have to do.

Related News:



Most liked

Pompeo accuses Iranian Supreme Leader of profiting from $95 billion hedge fund
But in a split with European allies, Trump said in May that the deal was a disaster and made a decision to leave the pact. Iranian officials have in the past threatened to block the Strait of Hormuz in retaliation for any hostile USA action.

Abuse mars Geraint Thomas's historic summit victory at Tour de France
Van Avermaet explained: "I was waiting for a reaction from Sky when I went to try and get in the breakaway, but nobody reacted". Cavendish struggled across the finish line atop the summit more than 1 hour, 5 minutes after stage victor Geraint Thomas .

GST Council reduces tax rates on more than 50 items
Around 90 consumer items, many of them popular with urban middle-class voters, will be impacted by the tax cut. The reality is, this group may find it hard to spare money for sanitary napkins even after the tax exemption.

Sony Reveals "Amazing Red" Spider-Man PS4 Pro Bundle
A custom Amazing Red 1TB PS4 Pro with the iconic white spider and matching red controller will be launching alongside the game. PS4 players are getting excited for the upcoming release of the new Spider-Man game , which hits shelves this Fall.

Judge Denies Request to Move Manafort Trial
Ellis to seal the court motions listing the witnesses' identities to prevent their identities from being publicly disclosed. All five have invoked their Fifth Amendment rights against self-incrimination, according to the four-page document.

Govt sails through no-confidence motion
Prime Minister Narendra Modi , who's a master orator, will attempt to set the record straight on the government's achievements. Congress president Rahul Gandhi's hit-hug-wink ways didn't enthuse the ruling BJP and Speaker Sumitra Mahajan.

Chelsea Announce Maurizio Sarri As New Manager
Nearly two months later Chelsea are looking for a 13th permanent boss of Roman Abramovich's ownership, which began in June 2003. Chelsea have signed Italy midfielder Jorginho from Napoli after Manchester City pulled out of a £50m deal.

Finnish president and Trump discuss 'many things'
On Friday his adviser Yuri Ushakov also played down expectations, saying: "The state of bilateral relations is very bad". Lawmakers from both parties expressed no such doubts, and some were scathing in their criticism of the president.

Joe Root's trust in his game results in timely Test boost
England batsman Joe Root celebrates his century off the last ball of the match with captain Eoin Morgan at Headingley. A stunned Kohli was left staring the pitch in disbelief before beginning a slow walk back into the pavilion.

Ruusia Hands Over World Cup Hosting Duties To Qatar
Then again, this World Cup served as a stark reminder that it's hard to defend a title at a major worldwide tournament. Police were unusually low-key about World Cup partying that turned a central Moscow street into a nightly fest.

Blue Origin will perform a high-altitude abort test at 10AM ET
Wednesday morning, Blue Origin launched a capsule-carrying New Shepard rocket from its facility in West Texas. Blue Origin has yet to announce when it will start taking reservations or how much flights will cost.

Harper wins Home Run Derby at Nationals Park
Cespedes popped 32 total home runs by the end of the night, beating Harper in the finals during the 2013 Home Run Derby . The first round started out with a bang, as Hoskins hit 17 out of the park and defeating Aguilar, who had only 12.

Woman has major leg trauma after lava hits boat in Hawaii
The lava is from Hawaii's Kilauea volcano , which erupted in May and has been spewing out gas and molten rock ever since. Kalapana Cultural Tours, which competes with Turpin's company, reported normal boat services and no cancellations.

Chelsea Target Former Goalkeeper As Real Madrid Move For Courtois
Liverpool have open talks with AS Roma for the transfer of Brazil keeper Alisson , according to Sky Italy and multiple reports. Simon Mignolet , meanwhile, is expected to leave Anfield this summer after he lost his place to Karius last season.

Unai Emery makes final Steven Nzonzi decision
It's Unai Emery's first game as Gunners manager and it comes in the form of a pre-season encounter with the National League outfit from Hertfordshire.