Tesla's Model S Ponzi Scheme Rakes in $2.6M. At Least

by Robert Farago

Published: April 2nd, 2009

tesla s model s ponzi scheme rakes in 2 6m at least

Now you may think that Tesla Motors, makers of the $109K+ lithium-ion powered Roadster, are acting in good faith re: taking deposits for their recently revealed Model S sedan. If so, GreenTech Media’s report that the Musk-scented company has secured 520 advance orders for the vehicle is a good thing: a sign of early adopters’ faith in Tesla’s ability to design, build and, eventually, sell the all-electric foor-door. Leaving aside Tesla’s past history of missing deadlines and changing announced specifications. With eyes wide shut, the fact that Tesla has collected $5K per car from 520 prospective customers, generating some $2.6M, is a good thing. Nothing wrong with raising a little—and in the car business $2.6 million is microscopic—working capital. The fact that Tesla’s first model, the Roadster, isn’t profitable, and that the new money may be helping to prop-up THAT side of the business, is neither here nor there nor the subject of a court case. So . . . good news! There may be more money on Tesla’s table!

You can plunk down $5,000 for a regular Model S or 40,000 for a “Signature Edition,” which is supposed to come with some nifty features that Tesla has yet to disclose. The company plans to make 2,000 of the special edition cars – half of them for the U.S. market and the other half for Europe.

Figuring half of those 520 orders are for the we-won’t-tell-you-what-that-means “Signature Edition,” Tesla may have recapitalized off its true believers’ backs to the tune of $6.5 million. Still not much. But better.

And what if Tesla doesn’t receive a dime of federal financing and goes belly-up? Although Musk has publicly pledged to back up deposits with his personal fortune, our sources say there is no such language on the deposit contract.

That said, if Tesla would like to email a jpeg or pdf of same to robertfarago1@gmail.com, I’d be happy to put the document up here for TTAC’s Best and Brightest to see for themselves.

Robert Farago

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Psarhjinian on Apr 02, 2009
It seems to me that cutting edge technologies are more likely to be embraced by smaller specialty firms than large, full-line manufacturers like Toyota. You'd think that, but as much or more cutting-edge work comes out of larger organizations than out of smaller ones, and generally with more polish and certainly more commercially viable. The Rogue Valley Entrepreneur isn't nearly the phenomenon it once was, especially now that a) larger companies are more favourable to R&D than they used to, if for no other reason than it provides patent fodder and b) it's nice to work for someone who can facilitate your every whim. You'll certainly see the occasional out-of-left-field win (like, say, Twitter) but that's not what Tesla is pitching. They're just a glorified coachbuilder/integrator with a good PR machine, and wouldn't stand a chance against the likes of Toyota, Honda or even GM's depth of engineering and research resources---if the big boys thought that the market Tesla and Fisker were playing in was commercially viable.

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Joeaverage on Apr 02, 2009

GO TESLA!!! They are delivering product and people want to place deposits. I'd say whether this is right or not is between the customer and the company. Right now I have more faith in them than I do GM delivering the Volt or in Phoenix Motor Cars delivering their SUT. The "S" is really, really nice looking. Might not be as good in person - dunno. Have always liked GM products better in pics than in person... I'm glad to see a company putting usable, refined EVs on the road. Not GEMs, not little pyramid looking things from the 1970s, not spacey Apteras (though congrats to them to for getting them out there). I'd buy an "S" but they belong to another tax bracket. I suppose I'm more likely convert my daily driver as it's value approaches nil in a few years.

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