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Comment by cs702 | Hacker News Reader

I also see the quarterly cash burn of $1.054 billion, and also don't understand how the company could reduce capex by $0.4 billion this year at the same time it aggressively ramps up Model 3 production... seems optimistic.

Looks like Tesla will need to raise more cash fairly soon.

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That is fairly simple. The main CapEx is installing a new line, setting up supply chain, acquiring robots, programming robots. Once you are done with that, you then just need to crank out cars.

> you then just need to crank out cars

To my ignorant but cynical ears, that sounds like a developer saying “then we just need to deploy it”.

More like saying that once you have the chairs, desks and computers, you just need to write the software. The developer salaries are operating expenses (opex.)

Isn't that the point though? That for building this kind of plant, you spend the money up front and then spend a lot of time, but less money, actually making it work.

From the outside that will look like a reduction in CapEx (once the up-front spend is done) followed by a "mysteriously" cheap ramp-up in production volume.

Yes. Deploy at internet-scale while debugging a completely new approach. Which could work - or not.

I saw a chart showing the same periods from S and X production. Apparently the highest capex comes right before ramp up since they have bought new equipment, tuned the process etc. As those issues are resolved you need less and less capex. But I am not an expert.

Elon promised they wouldn't need to raise cash this year.

Elon has promised a lot of things that didn't happen.

Elon has promised things that didn't happen quarter after quarter. Nobody trusts forward-looking statement from Tesla anymore.

I say that Tesla has to raise money in Q4 and you can trust me more than Elon.

random thought: they said most of the cash was to start the gigafactory, now that they've changed to expansion from "near"(c) full production, maybe they really need none or near none ?

Sure, and why in the world would you trust him? He's literally never met his guidances.

That's my point.

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