Bloomberg’s John Bowker reports on an Axios interview Tesla CEO Elon Musk in which he said that Tesla, at one point, had only a few weeks to live. He writes:
Elon Musk has revealed how close Tesla Inc. came to collapse during the frantic and costly effort to ramp up production of the Model 3 sedan: Little more than a couple of months.
“The company was bleeding money like crazy, and if we didn’t solve these problems in a very short period of time, we would die,” Musk told the news service Axios in an interview aired Sunday on HBO. When asked how close Tesla was to failing, he replied: “I would say within single-digit weeks.”
Musk’s comments come as a surprise because while questions swirled earlier this year regarding whether Tesla needed to arrange a capital raise, there were scarce predictions that the company would fail outright. Tesla’s run of losses and significant cash burn was finally snapped in the third quarter, when unexpectedly positive earnings suggested Musk could realize his goal of making electric cars financially sustainable. Once the company was able to boost production of the Model 3, deliveries have quickly taken off.
Read more here.
Jeremy Jones, CFA
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