James Chanos Calls Tesla’s Equity ‘Worthless’

CEO Elon Musk plans to make the Semi available in 2019 and the Roadster in 2020. Given that production lines generally have to be up and running years before production starts, Chanos believes these targets are impossible to achieve. (See also: Tesla Is Counting on Massive Leaps in Technology.).

Renowned Tesla Inc. (TSLA) short seller Jim Chanos has just taken another swipe at the electric car maker, claiming that the company’s “equity is worthless.”

In an interview with CNBC, the founder of hedge fund Kynikos Associates dismissed the idea that he was wrong to bet against Tesla, arguing that the company’s share price rise over the past year is being fueled by a series of lies. “To me, where the stock is now is not the story,” Chanos, who has been adding to his short position against Tesla throughout the year, said. “I don’t care that it came from $30 or $200 or $300. That’s just meaningless. We think the equity is worthless.”

Chanos pointed to Tesla’s recent unveiling of its electric Semi truck and Roadster sports car as the latest example of the company’s inability to tell the truth to investors. CEO Elon Musk plans to make the Semi available in 2019 and the Roadster in 2020. Given that production lines generally have to be up and running years before production starts, Chanos believes these targets are impossible to achieve. (See also: Tesla Is Counting on Massive Leaps in Technology.)

“Tesla and Mr. Musk have a broad interpretation of the truth,” he said. “There have been all kinds of announcements that this company has made … that turned out not to be true.” (See also: Reports of ‘Hundreds’ of Cars at Delivery Centers Calm Tesla Production Fears.)

Chanos’s comments came shortly after he made similarly disparaging remarks about the company at an event in Detroit on Wednesday. “Every bull market has its poster children,” he said at the event, according to Bloomberg. “Tesla is one of the bad ones.”

In Detroit, the perennial Tesla bear listed a number of other reasons why he believes the company “is headed for a brick wall.” Chief among them is the recent spate of executive departures, an issue that the hedge fund manager noted also happened at Enron Corp. before it failed. Chanos built his reputation for short selling after correctly betting that the Houston-based energy, commodities, and services company would collapse.

Having already lost several important executives, Chanos reckons the next high-profile figure to leave Tesla could be its CEO. The short seller expects Musk to depart in the coming years to focus on his other company, Space Exploration Technologies Corp. (See also: Tesla Should Merge With SpaceX: Morgan Stanley.)

Chanos also expects Tesla to get squeezed by increasing competition. Now that the company’s auto peers are ramping up investment in electric vehicles (EVs), he believes what little advantage it had is set to disappear.

“What Elon did was simple: He made EVs sexy,” Chanos said, according to Bloomberg. “Prior to that you had to compromise and get something like a Prius. But now he has the entire auto world that has figured that out and is coming up with aspirational cars. He’s fighting a different fight.”

Chanos made a similar argument for self-driving technology, noting that the likes of General Motors Co. (GM), Alphabet Inc.’s (GOOGL) Waymo and Volkswagen AG (VLKAF) now represent serious threats to Tesla. “Detroit and Germany are spending billions of dollars on this,” Chanos said. “Tesla is not a leader.”

Related Posts:

Deals this week: Virgin Hyperloop One, DB Engineering & Consulting USA, Stantec

Pune Metropolitan Region Development Authority (PMRDA) and Virgin Hyperloop One have signed an agreement of understanding, which will see the transport engineering company study the viability of installing a hyperloop transportation system in Maharashtra, India. Virgin Hyperloop One and its …

Pune Metropolitan Region Development Authority (PMRDA) and Virgin Hyperloop One have signed an agreement of understanding, which will see the transport engineering company study the viability of installing a hyperloop transportation system in Maharashtra, India.

Virgin Hyperloop One and its partners, in association with PMRDA, are set to work together to meet the regulatory requirements for the project under the agreement, as well as also provide information for use in the preliminary report.

The study intends to assess the benefits associated with hyperloop technology and will recognise a number of potential routes in the state, which will be devised via consideration of the demand for the system and various socio-economic factors.

“The European Bank for Reconstruction and Development (EBRD) has agreed to offer a €160m ($188.24m) sovereign loan to the Ukrainian city of Kharkiv for the extension of its metro network.”

If implemented, the system is expected to minimise the travel time from Mumbai to Pune to 14 minutes from the existing three hours by car.

DB Engineering & Consulting USA has been awarded a deal by the California High-Speed Rail Authority (CHSRA) to provide early train operator services for the US’ first high-speed rail network, the California High-Speed Rail project.

The contractor will provide planning, design and implementation services as part of the performance-based contract, which is not expected to go beyond $30m in value during the first phase.

Lead operator DB Engineering & Consulting USA’s partner Detusche Bahn will act as guarantor for the development.

Design firm Stantec and Amec Foster Wheeler have been awarded a joint contract by Metrolinx to provide technical support for the Bowmanville rail expansion project in Ontario, Canada.

The two companies are set to provide advisory, design and construction support services as part of the arrangement.

In addition, the scope of the contract comprises the addition of two GO Transit tracks, a new layover facility and four new stations.

It will also see the companies conduct 19 grade separations, including one over Highway 401, as well as bridge expansions.

The GO Transit service is scheduled to be extended along the Lakeshore East rail corridor by 20km from Oshawa to Bowmanville by the end of 2023 as part of the Bowmanville expansion development.

Ranken Railway Construction Group has been awarded three new rail transit contracts works along the Chengdu metro line in China.

The contractor will execute a number of projects worth a combined S$52m ($38.5m) as part of the first two contracts, including the construction of two 3km-long tunnels between Fuzhou Road Station and Xinglong Station, in addition to open-cut earthworks along the metro line.

Additionally, the third contract is worth roughly S$5m ($3.7m) and will see Ranken supervise the construction of a 25km-long track-laying work along Sancha Station to Terminals 1 and 2 of Tianfu International Airport Station in the second phase of the line.

The contractual work is expected to be completed between 31 December 2018 and 31 December 2020.

The European Bank for Reconstruction and Development (EBRD) has agreed to offer a €160m ($188.24m) sovereign loan to the Ukrainian city of Kharkiv for the extension of its metro network.

It is expected to be utilised for the construction of two stations at Derzhavynska and Odeska, in addition to a new metro depot.

The funding will also be used to acquire new rolling stock and extend the metro line by 3.5km to minimise traffic congestion in the southern part of the city.

In addition to the 18-year EBRD funding arrangement, Kharkiv is also slated to receive a loan of an equal amount from EIB.

Related Posts:

PE HUB First Read

Senator Marco Rubio says he will vote against the tax bill unless child tax credit for low-income households is expanded. Uber investor Shervin Pishevar resigns from Sherpa Capital. A coalition of states attorneys general, led by New York, pledge to sue FCC from rolling back net neutrality rules.

Senator Marco Rubio says he will vote against the tax bill unless child tax credit for low-income households is expanded.

Uber investor Shervin Pishevar resigns from Sherpa Capital.

A coalition of states attorneys general, led by New York, pledge to sue FCC from rolling back net neutrality rules.

Spotify price tag rises ahead of filing for NYSE listing.

New CalPERS board member leery of private equity takeover.

Cruise control designs could solve traffic jams, study suggests.

Hackers halt plant operations in watershed cyber attack.

Ripple surges 89 percent in a single day, briefly becomes third-biggest digital currency.

Two months after Las Vegas shooting massacre, authorities have gone silent.

Photo: Hyperloop One co-founder Shervin Pishevar speaks before a propulsion open-air test at Hyperloop One in North Las Vegas, Nevada, U.S. May 11, 2016. Reuters/Steve Marcus

Email preview

  • To:
  • From:
  • Subject: Look at this story on PE HUB
  • Lawsuit VC

    PE HUB First Read

    First Read ends the week with news that Marco Rubio could throw a wrench in the GOP tax bill, Uber investor Shervin Pishevar quits Sherpa Capital and two months after Las Vegas shooting massacre, authorities have gone silent.

    Continue reading on PE HUB

  • said:

Take your pick!

Related Posts:

Over 30000 hats sold!

Elon Musk’s ‘35,000’ Tweet Is Not As Random As You Thought. Here’s What It Means. Hinakshi Bhatia MensXP Staff Writer. Elon Musk is everyone’s favourite eccentric billionaire who like to post random and cryptic messages every once in a while and cause a lot of speculation. A couple of days ago, …

Elon Musk is everyone’s favourite eccentric billionaire who like to post random and cryptic messages every once in a while and cause a lot of speculation. A couple of days ago, he did it again and posted a tweet that got everyone talking.

35,000

— Elon Musk (@elonmusk) December 12, 2017

35,000 what Elon? Is it the number of times you’ve trolled us all?

Everyone was confused and started coming up with some explanation or the other. Since people can’t stop talking about Bitcoin these days, that was everyone’s first guess.

Bitcoin?

— Contr4rian [BTC$45k] (@wisemoe) December 12, 2017

Bitcoin target?

— Saleem (@SaleemUsama) December 12, 2017

But, nope that’s not it.

This was the best reply, tbh.

Is that how many times I’ve tweeted to you without getting a follow back

— a Young Man from the Midwest Coast (@DallasMichaelM) December 12, 2017

As it led to this beautiful Twitter interaction.

Decoding Elon Musk's Not So Random '35,000' Tweet

Decoding Elon Musk's Not So Random '35,000' Tweet

But, we still have to figure what 35,000 means, right? Let’s do some research.

Decoding Elon Musk's Not So Random '35,000' Tweet

After some deep digging in the dark web, and some great investigative work, we finally got some answers. Actually, it was just a little bit of scrolling on his Twitter account, but I can pretend I was doing this to decode the tweet –

Decoding Elon Musk's Not So Random '35,000' Tweet © Twitter

Well, it turns out that 35,000 is the number of hats he’s sold. Yes, hats, for real.

Over 30,000 hats sold!

— Elon Musk (@elonmusk) December 11, 2017

A man who wants to build colonies on Mars is way too grounded these days. Forget Tesla and Space X, he has a booming hats business and that’s his biggest priority.

Decoding Elon Musk's Not So Random '35,000' Tweet

Don’t Miss

One hat costs $20 and if he’s sold 35,000, that is literally $700k. Just by selling hats. Are you feeling bad about your salary now, because I sure am. He’s close to earning a million dollars by selling hats.

His super exciting company is called ‘The Boring Company’, because he is Elon Musk and he can do anything. He has big plans for when he hits 50,000 hats.

After 50k hats, we will start selling The Boring Company flamethrower

— Elon Musk (@elonmusk) December 11, 2017

I know it’s a little off-brand, but kids love it

— Elon Musk (@elonmusk) December 11, 2017

Yes Elon, it’s the perfect Christmas present for kids.

The Boring Company is one of Musk’s projects, which aims to tackle the problem of traffic by creating tunnels, because the only other solution was flying cars, apparently.

The website explains, “To solve the problem of soul-destroying traffic, roads must go 3D, which means either flying cars or tunnels. Unlike flying cars, tunnels are weatherproof, out of sight and won’t fall on your head. A large network of tunnels many levels deep would fix congestion in any city, no matter how large it grew (just keep adding levels). The key to making this work is increasing tunnelling speed and dropping costs by a factor of 10 or more – this is the goal of The Boring Company.”

To preserve the transcendent majesty & specialness of The Boring Company cap, we are capping cap orders at 50,000 caps. Almost there … https://t.co/YqjEQAfy3u

— Elon Musk (@elonmusk) December 3, 2017

Well, it seems like this super cool, yet boring hat is limited edition since Elon is ‘capping’ orders at 50k. You can get it here.

Tesla largely responsible for slide in US home solar sales

When Tesla bought SolarCity last year, Musk called the acquisition a “no-brainer,” saying the two companies shared “the same overarching goal of sustainable energy.” But under Tesla’s ownership, the company has largely stopped its aggressive marketing campaigns and ambitious expansion.

Reuters

By Nichola Groom

Dec 15 (Reuters) – After years of double-digit growth, home solar installations in the United States are poised to fall for the first time this year, according to a report released on Thursday by GTM Research.

The reason? An analysis of installation data suggests that most of the slowdown is traceable to a single company: Tesla Inc, which acquired sister company SolarCity about a year ago.

When Tesla bought SolarCity last year, Musk called the acquisition a “no-brainer,” saying the two companies shared “the same overarching goal of sustainable energy.”

But under Tesla’s ownership, the company has largely stopped its aggressive marketing campaigns and ambitious expansion.

As a result, Tesla’s rooftop solar installations have fallen sharply each quarter this year compared to last. In the third quarter, installations were off by 42 percent over the previous year.

Tesla declined to comment for this story, but has previously said that while sales are down, margins are up. The company expects its fourth-quarter solar installation numbers to be higher than those of the third quarter.

Overall, the residential solar market is expected to fall 13 percent this year, according to GTM’s quarterly solar market report, released on Thursday. That compares with a 19 percent rise last year and four straight years before that of increases above 50 percent.

SolarCity was responsible for an outsized portion of that growth, accounting for a quarter of the national market in 2016 and more than 30 percent the previous two years. By the third quarter of this year, its share had dropped to 14 percent, according to GTM’s U.S. PV Leaderboard report.

“If SolarCity accounted for a 30 percent share of the national market and you cut those installation volumes effectively in half, that’s really what we are looking at in terms of the market downturn in 2017,” said Austin Perea, who tracks the U.S. residential solar market for GTM.

SolarCity’s rapid growth was fueled in part by a no-money-down offering that enabled residential customers to pay a monthly fee to go solar. The business generated huge sales volumes but led to investor concern about debt.

In many ways SolarCity’s rise helped lift the fortunes of smaller rivals.

“They spent a lot of money making people aware of what solar can do and all of us little guys have been the beneficiaries of that,” said Jim Petersen, chief executive of Fremont, California-based PetersenDean, who said his company is forecasting sales growth of 7 to 9 percent this fiscal year.

Tesla stopped selling installations door-to-door earlier this year, eliminating a major way it reached new customers. It now sells systems in its high-end retail stores, where cars and batteries are also sold.

SolarCity’s fall has benefited some competitors. Sunrun Inc, the largest publicly held standalone residential installer, has gained market share this year, and its installations are expected to rise 15 percent in 2017.