Scraping for pennies?
American EV company Tesla, recently in the news for something other than stalled Model 3 production (though having your CEO call someone a “pedo guy” isn’t exactly an upgrade), seems to be doing something rather odd. In a memo sent to its suppliers, the EV manufacturer is reportedly asking for a “meaningful amount of money” back to help the firm get back into the black, it seems.
This is perhaps one of the oddest moves we’ve seen by Tesla Inc. for a long time, and comes as CEO Elon Musk pushes to get the company into a period of proper profitability. He previously stated his intent to have positive cashflow by the second half of 2018, and the biggest hurdle at the time was getting Model 3 production up to 5,000/week. Now that that’s been handled, it’s a matter of dollars and cents.
The memo, sighted by The Wall Street Journal, was said to communicate that the cash refund was critical for the company, and suppliers would be investing in the longevity of the brand. On Twitter, Musk responded saying that “only costs that actually apply to Q3 and beyond will be counted” and that “it would not be correct to apply historical cost savings to the current quarter.”
Previously, Tesla began asking its US & Canadian customers to place their confirmation deposits for their Model 3s, locking in orders and moving them into the production stage, and securing additional cash with which to operate. Prior to that, the company had reportedly lost nearly a quarter of its US Model 3 bookings, with our suspicions resting on the likelihood that prospective buyers just got bored of waiting.
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