REUTERS/Mark Blinch
Tesla CEO Elon Musk and former General Motors vice chairman Bob Lutz
- Bob Lutz, the former vice chairman of General Motors and prominent Tesla critic, would like you to know that he still believes Tesla's days are numbered.
- Lutz said in an interview with CNBC on Tuesday that the totality of the electric-car maker's financial, administrative, manufacturing, and legal problems signal Tesla "is headed for the graveyard."
- The remarks come at another challenging time for Tesla and its CEO, Elon Musk, as US authorities investigate his claim that he had "funding secured" to take his company private. Tesla is also working overtime to crank out as many of its mass-market Model 3 sedans as it can.
- "They will never make money on the Model 3 because the cost is way too high," Lutz said Tuesday. "He's got 9,000 people in that assembly plant producing less than 150,000 cars per year. The whole thing just doesn't compute."
Former General Motors vice chairman Bob Lutz says he thinks Tesla "is headed for the graveyard."
He pointed to a handful of Tesla's problems in a CNBC interview on Tuesday. The totality of the electric-car maker's financial, administrative, manufacturing, and legal problems, Lutz suggested, mean that Tesla's days are numbered.
The remarks come at a challenging time for Tesla and its CEO, Elon Musk, as US authorities investigate his claim that he had "funding secured" to take his company private. Tesla is also working overtime to crank out as many of its mass-market Model 3 sedans as it can.
"They will never make money on the Model 3 because the cost is way too high," Lutz said Tuesday. "He's got 9,000 people in that assembly plant producing less than 150,000 cars per year," he said, referring to Musk. "The whole thing just doesn't compute."
Lutz quipped that the company would be the subject of a "Who killed Tesla?" movie "in another year or two."
Indeed, Tesla has some daunting challenges ahead, including a massive amount of debt, including $920 million in convertible bonds that will come due by March 1, depending on where Tesla's share price ends up.
The company also faces a growing number of competitors that are moving into the electric-car space in earnest.
New examples from Mercedes-Benz, Porsche, and Audi have emerged. Lower-end competitors like the Chevy Bolt, which have the benefit of General Motors' massive manufacturing outfit, made it to market a full year before the Model 3. And the Nissan Leaf became the best-selling electric car in the world in 2017, with 300,000 sold since its introduction in 2010.
On the sales front, there could still be some promising news in store for Tesla. In the second quarter of 2018 alone, Tesla produced 28,578 Model 3 sedans, exceeding production of both the Model S and Model X, combined.
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