1/ If Elon were smart, he would announce that in China he’ll do what he should have done with the Model 3 - subcontract to somebody that knows how to build cars efficiently. In return for a cash payment upfront and a royalty payment per car sold. $TSLA
2/ This would require a complete repudiation of this bs about the machine that builds the machine and the product is the factory yada yada. But that rhetoric has already served its purpose - it was used to raise money and drive hype in the past. Today is a new day. $TSLA
3/ There’s room in the market for a $5-10B automotive marketing and design firm, and $TSLA could play that role well. The constraints to this are the existing debt and the sky high equity valuation. And of course Elon’s ego and a reconciliation with past ‘sins’, so to speak.
4/ If he could park his ego and subordinate to a firm that can execute in exchange for a fair value share, such a deal could create value for both sides. I’m dubious that he will, but that is the one thing that could come out of this China trip that would impact my thesis. $TSLA
