If you have the misfortune to follow or even periodically stumble across the discussion of Tesla impending bankruptcy on Twitter (#TSLAQ) or elsewhere on the internet, you’re aware that the company is now often being compared to Theranos, the onetime $9-billion blood-testing startup that’s now worth nothing and whose former CEO, Elizabeth Holmes, is currently facing criminal charges.
Tesla CEO Elon Musk has poured fuel on the #TSLAQ fire by running afoul of the Securities and Exchange Commission, just as Holmes did (she settled and was barred from serving as an officer of a public company for a decade). Tesla also added Oracle’s Larry Ellison to its board — and Ellison was a Theranos investor.
As l’affaire Theranos has broken out of the business press. John Carreyou’s Bad Blood, his account of Holmes’ and Theranos’ rise and fall, is a bestseller, with a film starring Jennifer Lawrence as Holmes in development. An HBO documentary premiered last month. A general climate of skepticism about Silicon Valley’s “save the world” ambitions has also emerged in the aftermath of Facebook’s scandals.
Read more: The biggest question for Tesla is whether the company can make steady profits on its cars
This has all undermined the reality of Tesla and replaced it with a sort of wildly speculative canvas onto which assorted conspiracies and malfeasances can be painted. At base, Tesla is a relatively small auto company that, remarkably, has come to dominate the mostly abandoned electric-car business (there are more than a billion cars on the road worldwide, and almost none of them run on electricity).
Outlandish enthusiasm on Wall Street for the future of electric cars — coupled with too much money sloshing around in the economy thanks to post-financial crisis government action — has minted a stupid-high stock price for Tesla and intensified the focus on the company. Tesla itself has struggled mightily with its manufacturing fundamentals, becoming an outlier in an industry that easily built over 17 million cars and light trucks in the US alone last year, while Tesla managed 250,000.
Looks bad, right? But is it Theranos bad? Hardly. Here’s why:
from Viral Update News http://bit.ly/2DbEWRG
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