Tesla’s performance gives Elon Musk much to think about

AT TESLA’S ANNUAL shareholders meeting on June 11th Elon Musk was as ebullient as ever. But its shares, which started the year above $300, have plunged close to $200 and its bonds recently traded at an all-time low of close to 80 cents on the dollar. Deliveries of the Model 3, the firm’s mass-market electric vehicle (EV), fell by over a fifth in the first quarter compared with the previous quarter, casting doubt on the firm’s annual sales target. Tesla raised $2.7bn in convertible debt and stock in May, but questions remain about how much cash it can generate—it burned through over $900m in the first quarter. Tesla may have outsold competitors last year, but faltering demand and a phase-out of EV subsidies in America are tough new challenges it has to face.

This post was originally posted at https://www.economist.com/business/2019/06/15/teslas-performance-gives-elon-musk-much-to-think-about.

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