During an interview with CNBC, Former General Motors Vice Chairman Bob Lutz suggested that Tesla's shares, which have persistently ranked among the most widely shorted among major US firms, will soon spiral to $0 because “the jaws are tightening and I think in another year or two we'll see a movie called 'Who Killed Tesla,' a conspiracy movie starring Leonardo DiCaprio.” Lutz, who has been a regular Tesla critic in recent years, argued during an interview that aired during “the Closing Bell” that “[Tesla] will never make money on the Model 3 because the cost is way too high.
The whole thing just doesn't compute.
It's an automobile company that is headed for the graveyard,” he said on “Closing Bell.” Musk has been banking on the success of the Model 3 to prove that Tesla can succeed as a mass-market automobile manufacturer, but the car and its customers have been plagued by massive delays in delivery as Tesla has struggled to meet production goals (even resorting to assembling some Model 3s by hand in a tent outside the company's Fremont Factory).
While Musk has been heralded as a visionary by some, Lutz believes that Musk is “a nice guy who doesn't know how to run a true car company.” But perhaps the biggest near-term threat for Tesla is the fact that the SEC likely won't allow it to raise new capital while the DOJ Investigation is ongoing, which could be hugely problematic as the company struggles to make several large debt payments due later this year and in 2019, as the company is already “hemorrhaging cash.” Lutz added that Tesla will continue to struggle in the face of long-anticipated competition coming not only from Audi but Mercedes, BMW and Porsche, all of which are preparing to bring to market their own electric vehicles that will compete directly with Tesla.
[…] “Tesla has no – tech advantage, no software advantage, no battery advantage.