“Bloomberg – Tesla Urges Workers to Prove the ‘Haters’ Wrong and Ramp Up Production“
When he’s not bailing out one of his ventures at the expense of another or selling flamethrowers, Elon Musk is taking on the Tesla haters. There certainly are a lot of them these days, especially with capacity constraints and exploding cars impacting not just Model 3 deliveries, but the company’s cap structure as well. Tesla’s 5.3% 2025 paper has gotten crushed over the last week or so, currently trading at ~7.6%. The volatility, combined with the market’s weariness of Tesla delivery targets, has resulted in, you guessed it: a credit downgrade from Moody’s to B3 (S&P likely on deck).
Listen I love Elon. The guy toes the line between genius and lunatic better than anybody out there. Sometimes he builds PayPal, sometimes he build a rocketship and launches one of his overpriced cars into orbit. You never know what you’re gonna get, and that’s the kind of leadership I can get behind (not with my money, though).
That said – the company is certainly in the crosshairs of every shortbook on the planet. No doubt they’ll need to access markets to fund production targets at some point this year. Whether they choose equity or debt is yet to be seen, but they’ll both be relatively expensive. I’m rooting for the guy, but I’m more so getting my popcorn ready and rooting for the ride ahead. What a shitstorm of a bankruptcy that would be.