Posted on 05/16/2019 1:52:11 AM PDT by blueplum
(Reuters) - The “great majority” of solar cells being produced at Tesla Inc’s factory in upstate New York are being sold overseas instead of being used in the company’s trademark “Solar Roof” as originally intended, according to documents reviewed by Reuters.
The exporting underscores the depth of Tesla’s troubles in the U.S. solar business, which the electric car maker entered in 2016 with its controversial $2.6 billion purchase of SolarCity.
Tesla has only sporadically purchased solar cells produced by its partner in the factory, Panasonic Corp, according to a Buffalo solar factory employee speaking on condition of anonymity. The rest are going largely to foreign buyers, according to a Panasonic letter to U.S. Customs officials reviewed by Reuters.
When the two firms announced the partnership in 2016, the companies said they would collaborate on cell and module production and Tesla would make a long-term commitment to buy the cells from Panasonic...
...The situation raises new questions about the viability of cash-strapped Tesla’s solar business. Musk once called the deal a “no brainer” - but some investors panned it as a bailout of an affiliated firm at the expense of Tesla shareholders. Before the merger, Musk had served as chairman of SolarCity’s board of directors, and his cousin, Lyndon Rive, was the company’s CEO. Panasonic spokesman Alberto Canal declined to comment on the company’s sales to Tesla, but confirmed that Panasonic was seeking to use its Buffalo operations to fulfill demand for U.S.-made solar cells from foreign buyers.
(Excerpt) Read more at reuters.com ...
...The situation raises new questions about the viability of cash-strapped Tesla’s solar business.
...
Tesla isn’t cash strapped. They just raised new capital and they’ll be receiving a payment of two billion dollars from Fiat.
Panasonic spokesman Alberto Canal declined to comment on the company’s sales to Tesla, but confirmed that Panasonic was seeking to use its Buffalo operations to fulfill demand for U.S.-made solar cells from foreign buyers.
I don’t see this as a problem.
Sold overseas is a good thing. The factory is selling its product.
Unless the cells are being sold at a loss. What’s the problem other than Solar Roof isn’t selling. But then maybe Americans are finally wising up to the fact that Solar is a scam.
I like Elon Musk, and I am really pulling for him to sort all this stuff out.
But, my instincts say that Tesla is going under.
The stock is worth $40 billion, but short selling is almost 22%, which is VERY frightening number.
the solar division :)
“Tesla isn’t cash strapped. They just raised new capital and they’ll be receiving a payment of two billion dollars from Fiat”
That money won’t last long, Forbes puts it into perspective. The Fiat deal is in the hundreds of millions, I have not seen the two billion you mentioned anywhere. Tesla has a burn rate of over half a billion a quarter.....
Good point, but the author shouldn’t have put it that way. It’s all one company.
Tesla’s Debt And Cash Flow Issues Are Overblown - Tesla, Inc.
Tesla’s cash flow from operations has been quite volatile over the prior three years which is to be expected. The company has lost as much as $639M (current March 31, 2019, quarter ended) and has generated as much as $1.93 billion in Q3 2018.
https://seekingalpha.com/article/4264392-teslas-debt-cash-flow-issues-overblown
We recently learned that Tesla and Fiat-Chrysler (FCA) reached a deal to pool their fleet together in Europe for the purpose of the latter avoiding emission requirement fines.
It was first reported to be worth a few hundred million dollars, but FCA now says that it will pay Tesla up to $2 billion for the emission credits.
https://electrek.co/2019/05/07/tesla-tsla-2-billion-fiat-chrysler-emission-standards/
I’m no fan of Tesla but exports are good for America.
Those must be some pretty hefty potential fines!
At any rate, provided taxpayers are not subsidizing them, solar cell exports to even the Chinese are fine by me. If it helps with the trade deficit and keeps Americans in good jobs, I’d say that was a win.
I know opinions on Musk vary, with some reason(s), but, good grief: We have FReepers who’s hatred of the guy is just irrational...
I can not clip and paste from this Reuters article.
However, what it states, if anyone bothers to read the article, is that the solar panel parts are being shipped overseas because IF the foreign assembler uses USA manufactured parts they can then sell the FULLY ASSEMBLED solar panel into the US without paying the US import tariff on foreign solar panels.
So, Panasonic makes the solar panel parts in the factory they share with Tesla in Buffalo. They then ship the US made “parts” to China or some other cheap Asian labor country. Then that manufacturer does not have to pay the duty/tariff on solar panels imported back into the US.
Would help cut the trade deficit.
Thanks blueplum.
One problem with the cells isn't the cells, it's that they increase property valuation, and in California that's become less popular due to the Tax Cuts and Jobs Act (PDJT's tax reform). TCJA should be made permanent, btw.
Another factor as to why they're not selling is that they are there to be paired with the powerwall, and those are 18 months behind on shipping. That's due to the success of the car sales -- both use the same battery technology, and obviously building and selling the cars will take priority.
This is what's sometimes known as a salad spinner of ****.
If battery production can be increased -- and Elon's companies have a history of fixing engineering problems and production problems very quickly -- such that the battery supply is no longer a bottleneck, then the stock will probably bounce back, again, from its recent very ugly slide.
[Friday close $190.63 / 52 Week High $387.46 / Low $ 186.22]
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