It’s safe to say former General Motors executive, Bob Lutz, is not a fan of Tesla. That’s become apparent over the past few years when Lutz repeatedly stated the company ultimately has no chance of financial survival.
Lutz appeared on CNBC’s Squawk Box, and this time, had choice words for not just the company, but die-hard followers, too.
“Tesla supporters are like members of a religious cult,” the former GM exec told CNBC’s Squawk Box. “Just like Steve Jobs was worshiped at Apple, it’s the same way with Elon Musk, who is seen as a new visionary god who promises this phantasmagorical future, a utopia of profitability and volume.”
Those are fighting words.
His comparison to Apple’s late Jobs wasn’t a kind parallel, either.
“The only problem is, Steve Jobs delivered and Elon, God bless him, hasn’t delivered a thing, except increasingly negative cash flow, and an increasing lack of profitability; more and more capital spending.”
Lutz calls out Tesla’s rampant cash burn of $250 million per financial quarter and stated the problem cannot be fixed with greater volume.
“Every time [Tesla] gets a $500 million injection from a new stock sale or a $750 million injection of new money, it lasts them two or three quarters. This is a problem that volume can’t fix.”
“If you’re in a variable loss – that is, you’re not recovering labor and materials in your sale price – then doing twice as many, or three times as many, or four times as many [sales] doesn’t help. The losses just get bigger and bigger.”
Tesla recently announced its latest U.S. numbers, showing positive increases, while Tesla stock jumped slightly following the news. We won’t really know the future of Tesla until the company’s promised Model 3 arrives in limited quantities, likely starting in 2018.