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Elon Musk's Tesla, Inc. has been having some problems recently. But one easy-to-overlook problem is the debt incurred by its SolarCity subsidiary:
But 16 months after Chief Executive Officer Elon Musk kicked up controversy by acquiring the solar-panel installer founded by two of his cousins, its obligations are a strain on Tesla's finances. The $2 billion purchase came with a $2.9 billion debt load, and a chunk of that is soon coming due. That's bad timing for a company churning through about $6,500 a minute and trying to stave off the need for another capital raise. "SolarCity debt may not be the immediate cause of Tesla's problems, but it certainly isn't helping right now," said Alexander Diaz-Matos, an analyst at credit research firm Covenant Review LLC.
[...] Tesla's debt runs the gamut -- convertible bonds, promissory notes, term loans, cash-equity debt, asset-backed securities. Most of the total is tied to Tesla the automaker. But the energy unit, which includes the solar business, accounts for 27 of the 29 maturities set to come due through 2019.
[...] In recent months, Tesla's solar business lost the residential-solar throne to rival Sunrun Inc., a San Francisco-based installer with a market capitalization about half the SolarCity purchase price. Tesla ceded market share as it attempted to boost energy-unit profitability and scrapped SolarCity's costly door-to-door retail sales strategy. That was a smart move, according to Ross Gerber, co-founder of Gerber Kawasaki Wealth & Investment Management, which oversees more than $10 million in Tesla shares and options. He criticized the SolarCity deal but is still bullish on the company and Musk. "SolarCity was probably going to go bankrupt," Gerber said.
[...] For his part, Musk hasn't wavered from his commitment to turn Tesla into a one-stop shop selling solar panels to capture power, devices to store the energy and cars that can be charged in the garage. The company started producing photovoltaic glass tiles in December at a factory in Buffalo, New York, and has begun selling solar at some of its own stores and through retailer Home Depot Inc.
At least Tesla production is higher than ever.
(Score: 3, Interesting) by khallow on Saturday April 07 2018, @01:52PM (5 children)
And what's supposed to be bad about that? No one is forced to work there. And one of the "good things" is being paid well - which is why it happens in the first place.
That's life. Everything we do and need requires risk of death and injury on someone's part, frequently not our own. Even the food we eat once was alive.
(Score: 2) by bobthecimmerian on Sunday April 08 2018, @04:33PM (4 children)
Just because the market allows something, that doesn't mean it's morally right. Having the right to quit isn't that valuable when you need to keep your medical benefits and there are no other employers offering enough money to cover your expenses.
And if it's impossible for a business or industry to succeed without causing human suffering (not counting things like dental procedures that inescapably involve some pain to fix problems), the industry doesn't deserve to exist.
The people crying, "Natural selection in society is fine!" are just lucky. For every disciplined, intelligent, hard-working person that succeeds there are many just as bright and just as hard-working that fail. "Fuck you, I got mine" is not an intelligent response to the losers.
(Score: 1) by khallow on Monday April 09 2018, @04:54AM (3 children)
Why is that supposed to be relevant? Let us keep in mind that markets exist in the first place because they serve the wants and needs of the market participants. That is a morally right thing to do. There are several ways markets can go wrong (externalities being the traditional example), but merely delivering what people want is not one of those things.
That applies to you and your endeavors as well. What is the fix for your situation? Suicide?
Now, we've gone from markets to social Darwinism? The obvious rebuttal to the above line of crap is come up with something better first. Markets work. Morality untethered from reality does not.
(Score: 2) by bobthecimmerian on Monday April 09 2018, @04:59PM (2 children)
The market is social Darwinism.
And markets don't exist to service the wants and needs of the participants. They serve the wants and needs of a few lucky participants, everyone has the choice of 'attempt to participate or starve'. That's not free association in any meaningful way.
(Score: 1) by khallow on Monday April 09 2018, @06:45PM
We can easily show this is false. For example, using a dictionary, social Darwinism [oxforddictionaries.com] means:
Meanwhile, market [oxforddictionaries.com] means:
So notice the complete absence of markets in the definition of social Darwinism. And notice the emphasis on trade, demand for trade, and places for trade in the definitions of market. As one would expect, we have very different definitions for very different things.
(Score: 1) by khallow on Monday April 09 2018, @07:09PM
So who is the "lucky" few that you participate for in these markets, sacrificing your interests?
Is starving better than participating? I'm curious in a very sarcastic way. I hope also you're not one of those social contract people who doesn't actually believe in voluntary participation.
So how much of your budget is food? For me, it's under 20%, and I have a fairly low income. When participation in the market (such as the job market) means that you can easily meet your needs, then what's the point of complaining? You aren't going to need any less, if you don't have a convenient market to help you meet your needs.