Thursday, June 20, 2019
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Tesla burns too much money: Musk announces austerity measures

DHe Tesla CEO Elon Musk has announced in a mail to employees hard austerity measures for the company. The US media network "The Verge", citing Reuters and Electrek, reports that Tesla would otherwise run out of money in 10 months. Musk and CFO Zach Kirkhorn would, according to the email, "review all expenses of any kind around the world, including components, salaries, travel expenses, rents, literally any payment that leaves the bank account." The cost reduction is needed despite the recent $ 2 billion capital increase.

"That's a lot of money, but the first quarter money-burning rate gives us only 10 months to break even," Musk wrote on Thursday. "It's tough, but it's the only way for Tesla to become financially sustainable and achieve our goal of making the world more environmentally friendly."

Already a year ago, Musk had criticized the company's high spending and announced that the finance team was "cutting through all the world's small expenses and restricting everything that does not have a strong value foundation."

In the first quarter of 2019 Tesla made a loss of 702 million euros. After earning a profit in the final two quarters of last year, Musk had promised long-term profitability. Instead, the electric car manufacturer was again highly deficient in the first quarter of this year. The loss of $ 2.90 per share was much higher than analysts expected. Only for the third quarter Tesla reckons with a profit.



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