Brad Kenagy recently wrote an article titled, "Tesla Just Said What!" where he highlighted the following statement in a recent Tesla press release:
"While the P100D Ludicrous is obviously an expensive vehicle, we want to emphasize that every sale helps pay for the smaller and much more affordable Tesla Model 3 that is in development. Without customers willing to buy the expensive Model S and X, we would be unable to fund the smaller, more affordable Model 3 development."
I wanted to follow-up with Brad to learn more about his thesis.
A few hightlights:
- Will Tesla need to raise more capital via secondary offerings leading to further stock dilution?
- Does Tesla's current junk bond rating pose significant problems for raising capital?
- Will Tesla ultimately be able to fund the Model 3?
- Is the attempted acquisition of SolarCity an act of desperation?
- Where do both companies presently stand regarding cash flow and profitability?
I hope you enjoy the interview.