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Comment by partiallypro | Hacker News Reader

Yeah, most of the "reservations" are not going to be real customers. It's just something to tout to shareholders to justify their massive multiple. Tesla is in a race against the clock, they are practically corporate welfare queens with their subsidies and they continue to take on more debt.

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I'm confused by the assertion.

Do you mean that a lot of people that reserved are not serious? They had to pay $1,000 for the reservation, so that looks unlikely to me.

Or do you mean the company has inflated the number of actual reservations?

For example, I made a reservation. We expect to buy a car somewhere around 2018, so we made a reservation in case we want a Model 3. I expect the model 3 will be high on our list, but we'll definitely comparison shop when the time comes.

The $1000 is 100% refundable. A person that can afford a Tesla can afford to put down $1000 with no risk. Heck, even a normal middle class person could probably foot $1000 at no risk.

Reservations are not sales. They are just something to tout to shareholders. If they wanted real numbers they'd make it non-refundable and up the down payment. The stock trades at an absolutely insane valuation (it's actually valued not too far from massive manufacturers like Ford and GM), the company will have to take on more debt to fulfill the reservations putting the company at liquidity risk. If the orders don't come through and you have increased debt burden, you're gonna have a bad time. This isn't something I'm making up, even the analysts at UBS agree.

> Heck, even a normal middle class person could probably foot $1000 at no risk.

Huh? What "middle class" are you talking about? In the USA, 2 in 3 people can't afford a $500 car repair or $1000 emergency room visit [1]. My guess is that people putting $1000 down on a car are either pretty rich or pretty serious about buying it.

1: http://www.prnewswire.com/news-releases/63-of-americans-cant...

That article is not about the middle class, and the target audience of Tesla is generally going to be someone that has disposable income and an education (which your own article alludes to having increased savings.)

>If the orders don't come through

This is absurd. Do you seriously think that Tesla wont have every single Model 3 sold the moment it comes off the line? People were waiting in half mile long lines for days to pre order a CAR.

I never said that they wouldn't get a single order, that's ridiculous.

> Reservations are not sales

Straw man. No one has said that. What they've said is Tesla just got a couple hundred million in free financing.

Most of this thread is people telling me that people put in $1000 so they are going to buy the car, which is ridiculous. That's not a straw man, that's people equating a refundable reservation with an order.

>Tesla is in a race against the clock

You can check my comment history: I'm as annoyed by the Tesla hype-machine as anybody. The games they play when reporting (or not reporting) financial metrics is astounding, and I don't understand why the SV crowd finds it acceptable for a public company.

However, I want to see Tesla and the whole EV industry thrive. People just need to curb their expectations.

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