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Is Elon Musk hurting Tesla? (Mod Note Post #1)

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Comments

  • Registered Users, Registered Users 2 Posts: 9,729 ✭✭✭CMOTDibbler


    If you think about that 58% representing personal debt, effectively that means he's likely burned through a significant proportion of that. He's paying himself through borrowings to avoid tax. But what's significant about that is that the avoidance has to come to an end at some stage and the tax bill will be pretty darn big.



  • Moderators, Motoring & Transport Moderators, Regional East Moderators Posts: 8,262 Mod ✭✭✭✭liamog


    That's pretty much the current meta for any significant employee holder of company shares. Get paid in equity which has reduced tax obligations, then use the shares to obtain loans paying 0% tax, keep rolling it over as long as you can. At some point you decided do I cash out a chunk of the shares to clear the loans but will have to pay a significant tax bill.

    Anytime you see a CEO being all high and mighty about taking a $1 salary remember it's tax planning not an altruistic move.



  • Registered Users, Registered Users 2 Posts: 9,729 ✭✭✭CMOTDibbler


    The only problem with that model is that it's not necessarily you who decides the shares have to be cashed in. In Musk's case I think it's unexercised options. I believe Morgan Stanley are the bulk lender, so if they see the share price sliding and decide the risk is unacceptable, they could pull the plug which could have massive ramifications for the share price since the holdings are so significant.



  • Moderators, Motoring & Transport Moderators, Regional East Moderators Posts: 8,262 Mod ✭✭✭✭liamog


    What's the saying when you owe the bank 100,000 it's a you problem, when you own them 100,000,000 it's a them problem. Modern financing for CEO's of publicly traded companies seems to me to be a large pyramid scheme, everybody involved needs the share price to go up to keep the ball rolling.

    Tesla's pricing at Mobility as a Service levels is a reflection on that, making cars is seen as just a means to an end which is why I think a significant chunk of the shareholders are going to ignore everything that's going on with the bet being that the future goals more than make up for any drop in sales due to reputational damage.



  • Registered Users, Registered Users 2 Posts: 5,667 ✭✭✭yagan


    Id imagine the other 87.2% shareholders in Tesla will move against him if they believe his antics are putting people off the product.



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  • Registered Users, Registered Users 2 Posts: 13,003 ✭✭✭✭the_amazing_raisin


    Honestly at this point Tesla the car company and Tesla shares are at best loosely related

    By any measure of sense the share price should be undergoing a sharp downturn, but it's going up because people are buying it, because they think it'll keep going up forever, and so on

    As far as the shareholders are concerned, Elon is doing his job perfectly. Tesla the car company could sell zero cars but if the share price goes up by 50% then they'll still be happy

    "The internet never fails to misremember" - Sebastian Ruiz, aka Frost



  • Registered Users, Registered Users 2 Posts: 13,003 ✭✭✭✭the_amazing_raisin


    I've been saying for a long time that this manic cycle of infinite growth and leveraged debt without any meaningful increase in value can't go on forever

    However, I've so far been wrong

    Much like any overheated and overleveraged economy, it'll come crashing down as soon as enough people believe it's about to crash

    There just seems to be enough people bought into the dream to keep the share price climbing for a while yet

    More specifically regarding Musk's debts and tax liability, no doubt there'll be a significant tax break coming from his new best buddy president

    As Liam also alluded, there's a degree of too big to be allowed to fail with these companies. If for example X tanked tomorrow it would likely receive a government bailout for being an "essential service" or something

    "The internet never fails to misremember" - Sebastian Ruiz, aka Frost



  • Registered Users, Registered Users 2 Posts: 10,724 ✭✭✭✭MJohnston


    This will spread wider I think (and I wouldn’t be surprised to see Tesla cars start to get targeted too):

    https://bsky.app/profile/politico.eu/post/3lhbogjlkts2c



  • Registered Users, Registered Users 2 Posts: 25,440 ✭✭✭✭Larbre34




  • Registered Users, Registered Users 2 Posts: 5,667 ✭✭✭yagan


    It could be just a sign of a dysfunctional market.



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  • Moderators, Society & Culture Moderators Posts: 42,200 Mod ✭✭✭✭Gumbo




  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    is highland m3 delivering in the US yet? It might be a slowdown in shifting old stock, let’s face it you’d need a serious discount to buy the old m3 at this point.

    And lest we forget, just 6 days ago the CEO of Tesla forecasted a return to 20-30% sales growth in 2025 - and he would have access to all this sales data on a daily basis.

    Imagine that 🤔



  • Registered Users, Registered Users 2 Posts: 34,358 ✭✭✭✭listermint


    Yet it drops everywhere else on the planet thst does have Highland...

    Head in the sand stuff. They should be knocking it out of the park. Instead he's becoming increasingly a noose on the brands neck



  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    One interesting piece of data,

    Tesla dropped 11%, but if you exclude them the California EV market was up 20% - so people still bought an EV in the same numbers as last year, but 1 in 10 Tesla buyers bought something else.



  • Registered Users, Registered Users 2 Posts: 5,480 ✭✭✭MojoMaker


    Wouldn't be surprised if that was pure politics at play. If the EV credits landscape shifts, as has been suggested, it might all change though?



  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    didn’t realise that Teslas California sales have seen year on year drops for 5 straight quarters:

    So these Jan numbers aren’t actually that unusual - although a deep blue state like California would be the canary in the coal mine for all Musk-related issues effects.

    image.png


  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    m3 (highland) sales in Australia down 62% year on year. It’s a huge market for them:

    https://www.carexpert.com.au/car-news/teslas-australian-sales-slump-continues-into-2025


    Germany and the UK will be the other ones to watch

    Edit: Jan deliveries for top 8 EU countries down by almost half 😳

    https://electrek.co/2025/02/03/tesla-tsla-sales-are-dropping-like-a-rock-in-europe-but-its-not-just-because-of-elon-musk/



  • Registered Users, Registered Users 2 Posts: 5,667 ✭✭✭yagan


    Its not like Trump voters will buy a discounted Tesla considering "drill baby, drill" is a common Trump rally banner.

    Edit to add, even those who don't care about the politics will be mindful of the knock on to resale value and will be eager to move to a unpolitical brand.



  • Registered Users, Registered Users 2 Posts: 9,729 ✭✭✭CMOTDibbler


    The other factor not addressed in that article is the increased competition from other brands. That has to have an affect on Tesla sales. Although that could also be part of the anti-Musk sentiment where there's now a viable choice.



  • Registered Users, Registered Users 2 Posts: 496 ✭✭Gile_na_gile


    Their first mover advantage is being eaten now by the Chinese firms who are now also at the cutting edge of R&D. The politics are like 1930s Henry Ford, but if they can push past the identity politics and US culture wars, they could continue to anchor themselves in Europe as a European-made car with American roots like Ford. Another stupid Musk salute, in jest or otherwise, will isolate further their buyer market. Same for appearances at AfD rallies and moronic tweets. Like Trump and his toilet tweets, their CEO needs filtering and management oversight…



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  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    having a viable alternative is THE most important part of the “is musk costing tesla sales” - the sales have to go somewhere, and if tesla is the market leader then there needs to be very viable options for buyers



  • Moderators, Society & Culture Moderators Posts: 42,200 Mod ✭✭✭✭Gumbo


    January 2025 sales up on January 2024 sales.

    Although, most, if not all of these orders would have been before the Musk/Trump marriage, Feb and March will be more revealing.

    image.png


  • Registered Users, Registered Users 2 Posts: 13,003 ✭✭✭✭the_amazing_raisin


    Be careful with regarding California as a blue state, the true situation is that there's a pretty even distribution of democrat and republican voters across the country. Its only because of their bonkers electoral college system that there's such things as red & blue states

    "The internet never fails to misremember" - Sebastian Ruiz, aka Frost



  • Registered Users, Registered Users 2 Posts: 5,667 ✭✭✭yagan


    Interesting mention on the US made Y model having 70% of its parts produced within the US, the rest of the parts coming from Canada and Mexico. The thing that surprised me was that Kia's US made EV6 has 80% of its parts made in the US and are in that regard less vulnerable to Trumps threatened sanctions.

    If Musk was hoping to protect Tesla from competition in the US I can see the competition still overtaking.



  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    apparently it’s even more complicated than that for many car manufacturers, with some car parts and materials crossing the border over and back multiple times before the final car is complete.



  • Registered Users, Registered Users 2 Posts: 4,004 ✭✭✭sk8board


    It was more a point of California being the genesis of the Tesla brand. If they’re not buying Tesla’s in the same numbers (be the buyers red or blue), then the ripple effect will be obvious in the big markets like Europe and Australia



  • Registered Users, Registered Users 2 Posts: 5,667 ✭✭✭yagan


    I remember Stellantis buying the Vauxhall plant near Liverpool with the intention of just producing less complex vans for the British market but they've issued profit warnings for the operation as parts weren't as easy to source within Britain as had been anticipated. Won't be surprised if they fold in the next few years.



  • Registered Users, Registered Users 2 Posts: 5,667 ✭✭✭yagan


    I think even before his love in with Trump his cybertruck put off a lot of long time fans. It would be like a brand like Ferrari adding a clown car to their line up.



  • Registered Users, Registered Users 2 Posts: 36 somenergy


    For six years he has duped investors in his ponzi scheme promising the robo taxi

    Bear in mind if a computer is driving and a passenger doesn't comply car is off the road ie getting sick over the interior

    think Musk is now a negative for the stock too his credibility is shot.

    But he has got the reigns on power and is abusing it to his advantage down loading personal data of US citizens under rep/Don's watch.

    A coked up nazi from south Africa is running a mock inside America's democracy with the republicans blessing.

    No I won't be invested any more or buy an electric car especially a teasla even though I have heard good reports.

    God help America from what I have seen this week.



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  • Registered Users, Registered Users 2 Posts: 13,003 ✭✭✭✭the_amazing_raisin


    This is key I think, back in 2015 if you wanted an EV but didn't like Musk then your choices were the Nissan Leaf, Renault Zoe or Chevy Bolt

    I'm probably missing a few but you get the idea, all low range cars that only really worked for urban driving

    Now there's a whole range of options for EV buyers

    Yeah I'm sure someone is going to point out that Tesla does some things better, and they do, but pretty much all EVs nowadays do the car part of the product pretty well, the rest of really just extras

    "The internet never fails to misremember" - Sebastian Ruiz, aka Frost



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