Thread by @the_jasonsamuel

Is #Tesla really profitable ? (Why it will fail in India-thread)

The only way a tiny profit exists is by selling ZEV credits. Without zero-emission vehicle (ZEV) and other regulatory credits, they wouldn't be able to report four consecutive quarters of GAAP profitability, (1/8)

a milestone that met the qualifications for Tesla to join the S&P 500. In California &at least 13 other states, any auto manufacturer who wants to sell their cars into that state must sell a certain amount of electric/hybrid electric/other ZEVs. (2/8)

Automakers who are not selling these vehicles yet, or not selling many of them anyway, will buy credits from someone who is for compliance. Since Tesla only sells ZEVs, it doesn’t need to keep the credits that it earns and can sell them before they expire. (3/8)

According to its earnings report, Tesla’s total revenue hit about $6.04 billion for the quarter, with about 7% of that, or $428 million, coming from sales of these credits. To put that in perspective, regulatory credit sales were greater than the company’s free cash flow, (4/8)

and amounted to four times Tesla’s $104 million of net profit for the quarter. That is bad news and is one reason the S&P won’t touch Tesla. Also, TSLA has liabilities of almost 30 Billion dollars and has yet, in 17 years, to make a legit nickel making cars. (5/8)

The Tesla fanboys (Not Elon's - I like him) look at the stock price and get pissed when you challenge the myth of Tesla. Everybody looks at the crazy stock and stories about Musk’s personal wealth, but the company is an inch from bankruptcy. (6/8)

Everybody looks at the crazy stock and stories about Musk’s personal wealth, but the company is an inch from bankruptcy. 7% of their revenue is corporate welfare from the Gov. Add up my previous thread on Tesla cars on India and this. It is doomed to fail. (7/8)

With @anandmahindra 's @MahindraElctrc leading the charge here for EV cars (which might probably be affordable), TESLA will barely make a scratch here rather than people who will buy it for show offs. #Mahindra knows Indian roads and customer behav. better! (8/8)