John Engle, Almington Capital Merchant Bankers Profile picture
family office | VC, PE, stocks, cannabis, real estate | value, special situations, opportunistic/growth MBA (Oxon) | MA (Dubl) | DipGrad (Lond)
5 May 20
Elon Musk's "genius engineer" mystique would not be possible if it weren't for the uncritical reporting of fawning "science & technology" journalists. Let's discuss how this works using the example below. $TSLA $TSLAQ

cc: @TESLAcharts for your list of aiders & abettors.

Elon has argued publicly that a single giant solar plant in Utah could power the entire United States. For example, he made this claim in a December 2015 speech at the Sorbonne. $TSLA $TSLAQ

This idea is laughable to anyone with high school-level of physics knowledge. It's a matter of wire resistance, which will is a limiting factor on power transmission, regardless of where the power is sourced (coal, solar, dreams, etc.) $TSLA $TSLAQ

Read 12 tweets
30 Oct 19
1) The slight rebound in solar deployments in Q3 does not appear to represent a meaningful reversal of the multi-year downtrend. Investors banking on Tesla being “more than just a car company” should think again. $TSLA $TSLAQ…
2) Tesla’s solar deployments have been in near-freefall since 2016. Deployments declined from their all-time high of 253 megawatts in Q4 2015 to a low of 29 megawatts in Q2 2019 (thanks to @TESLAcharts for his ever-excellent visualizations) $TSLA $TSLAQ
3) Even with the 48% Q3 upswing, deployments were still less than 17% of the all-time high and barely more than half of the quarterly average set in 2018. Tesla has fallen to third place among solar installers (and is falling further behind). $TSLA $TSLAQ…
Read 12 tweets
16 Oct 19
1) Thread on 3Q19 earnings: The $TSLA long thesis assumes that it will not only soon become profitable (necessarily ignoring all material evidence showing this is false), but also that it is somehow immune to auto market cyclicality. We call BS. $TSLAQ…
2) Auto manufacturing is a cyclical industry. That's just a fact. Yet, even when producing at full capacity in a robust consumer market, $TSLA has proven only fleetingly profitable – and even then it took a host of one-off gimmicks to do it in 2H18. $TSLAQ
3) 2H18 profit came thanks to a lot of financial engineering, a focus on high-ASP variants, stiffing suppliers, etc. They could only do that once. As we opined at the time, 3Q18 was as good as it would ever get for Tesla. $TSLA $TSLAQ…
Read 17 tweets
6 May 19
1/ Thread on our recent note on the @WeWork IPO:

TL;DR - VC has bid WeWork's valuation to ridiculous levels, but public markets won't be nearly so generous. Its bloated valuation will soon be on the butcher’s block. This short will be fun.

Full note:
2/@WeWork's cash burn is insane, getting worse every year. A $1.9B net loss in 2018 set a new embarrassing record.

And the losses are not likely to end soon, if ever. Bernstein analysts estimate it will need $19.7B in financing through 2026.…
3/ The premise underpinning @WeWork's business model is that it can "make it up on volume". The Silicon Valley notion that physical businesses can scale just like software startups has proven contagious. But it is nothing but a fantasy.…
Read 8 tweets
17 Apr 19
1/ Thread on Starlink, @SpaceX's proposed satellite constellation. This is the program that's eventually supposed to pay all the bills and fund its Mars mission. Yet, according to Gwynne Shotwell, it might not happen at all. $TSLA $TSLAQ

Our full article:…
2/ While it costs nothing to dream about a future manned Mars mission, actually undertaking one will. According to the National Research Council, a manned Mars mission would carry a hefty $220 billion price-tag. $TSLA $TSLAQ #SpaceX…
3/ SpaceX remains unprofitable & it knows that launching satellites for government & commercial customers can neither provide the cash necessary to fund its ambition of space exploration, nor justify its eye-watering $30 billion valuation. $TSLA $TSLAQ…
Read 9 tweets
26 Mar 19
1/ Thread:

@Zackfoot has shared a remarkable presentation given by Tom Bachrach to students at @Wharton on the emerging signs of fraud at $TSLA.

Bacharach cites several red flags, which we discuss in a new note:

@Paul_M_Huettner @TeslaCharts $TSLAQ
2/ Red Flag 1: A cursory examination of $TSLA reveals that it is a co. & stock built on a narrative of rapid growth. $TSLAQ has actually been slashing capex to the bone, casting doubt on its ability to build production capacity & promised new models
3/ cont.: Last year, $TSLA pulled out all the accounting stops to engineer a blowout Q3. Elon relied on one-offs to orchestrate an unrepeatable result. Meanwhile, evident falling demand & collapsing margins this Q prove 2H 2018 to have been inherently unsustainable. $TSLAQ
Read 11 tweets
5 Mar 19
1/6 Thread:

Elon's Model Y pump clearly hasn't gone as planned. Far from a cause for excitement, the 3/14 unveiling looks like an act of desperation. Tesla's back is against the wall. $TSLA $TSLAQ

@TeslaCharts @auto_schmidt @CoverDrive12 @orthereaboot…
2/6 The unveil, followed so soon after the $35k Model 3 flop, looks like an effort to shift the market's focus from the ugly present to a brighter future. This has been a standard Musk play for years. But this time the market isn't buying it. $TSLA $TSLAQ…
3/6 The market's worries are understandable.

Demand in the US has collapsed, as @TeslaCharts so aptly charts.

EU demand has failed to make up the difference (Cheers again, TC. Ditto, @auto_schmidt for the Germany data). $TSLA $TSLAQ
Read 6 tweets
13 Feb 19
1/6 The Model 3 has been the hinge of $TSLA's growth narrative for years. Boosters touted a vast pre-order book as evidence of massive demand, declaring that it would take years to work through the backlog. That narrative has essentially collapsed. $TSLAQ…
2/6 $TSLA has spent yrs plugging the 450k order backlog. Elon couldnt stop tweeting about it and the co. kept touting it. Then, as of the Q4 call, they're "not thinking" about it anymore. Closest we'll ever see to them confirming backlog exhaustion. $TSLAQ…
3/6 Of course, we know why they've stopped touting the backlog. Not only is it gone, but demand has effectively collapsed in N. America, with just 6.5k deliveries in Jan. $TSLA $TSLAQ
Read 6 tweets
7 Feb 19
1/6 $TSLA's solar division has been collapsing in slow motion for a while, but in recent days some folks have finally started waking up. The ramifications for Tesla & Elon Musk will be severe. $TSLAQ

@SenKennedy @NewYorkGOP @news4buffalo…
2/6 $TSLA hit a 5-year low of solar installations in Q4 2018 (the estimable @TeslaCharts offers a great graphical depiction of this obvious wind-down).

And there's more pain to come: Tesla's guidance shows even less deployment in Q1, meaning a new post-2012 low. $TSLAQ
3/6 Meanwhile, Gigafactory 2 in Buffalo, where $TSLA builds its solar power systems, has cost New York taxpayers $750 million. Elon promised to create 1460 jobs in exchange. Current reported headcount: 800 (half of which are Panasonic employees. $TSLAQ…
Read 6 tweets
26 Dec 18
1/6 So $TSLA rockets into the close on the basis of an @elonmusk tweet pledging 100% Supercharger coverage in Europe in 2019 without any justification. Or 8K. Nothing. Yet surely it'll cost big $ to do. $TSLAQ

@markbspiegel @MidwestHedgie @painfulshort @jaberwock2 @Polixenes13
2/6 Supposedly, Elon is to have potentially market-moving tweets vetted by a securities lawyer, as per his settlement with @SEC_Enforcement. Of course, we know how much he respects that particular agency. Babysitting's set to commence no later than Dec. 28. Is this a last hurrah?
3/6 Of course, we also know, thanks to his @60Minutes interview, that Our Lord Elon feels protected by the 1st Amendment & doesn't much mind if some market-moving tweets slip through the cracks on occasion. $TSLA $TSLAQ…
Read 7 tweets
26 Dec 18
1/ Brief thread on $TSLAQ production & demand. These are 2 sides of the $TSLA narrative. It needs exponential growth in production AND the demand to absorb said production for the huge market cap to hold. We already know production has stalled out. Just look at Bloomberg's model.
2/ As we know all too well (and as we've repeatedly recounted), production can't be sustained at the rates @elonmusk has promised. Long gone is the 7k burst wk, let alone the 10k/wk M3 promises. Even the 5k/wk "sustained" rate has proven ephemeral. $TSLA…
3/ Thanksgiving was the last week of $TSLA "production hell", in which Elon fought to show a 1k/day extrapolation. Evidently, that particular flavor of flimflam has gone out of style. Unsurprising, since such bursts have proven busts time and again. $TSLAQ…
Read 10 tweets
18 Dec 18
1/ Thread on @SpaceX trying to raise $500mn in the wake of a punishing @WSJ exposé based on our latest note:


@markbspiegel @TeslaCharts @BlondesE @WallStCynic @painfulshort @iamhubris @orthereaboot
2/ In its last funding round, in April 2018, #SpaceX was valued at $27.5bn. As of this latest round, it's now valued at $30.5bn. That is crazy for an unprofitable company facing a weak 2019 launch schedule & mounting competition. $TSLAQ

3/ The valuation is even crazier when one recognizes that, not only is #SpaceX unprofitable, it deliberately tried to deceive the debt market about that fact by excluding a number of critical expenses from its prospectus. Classic @elonmusk and $TSLAQ…
Read 12 tweets