Tesla Bankruptcy: How Elon Musk Saved Company with Top-Selling Model 3 Electric Cars

Urian B., Tech Times 06 November 2020, 08:11 am

Tesla today is known as one of the most valuable companies as well as one of the most profitable automakers (not just in the EV industry) all around the world. But what some people do not know is that just a short while ago, the company almost dipped into bankruptcy.

Elon Musk Almost Applied for Tesla Bankruptcy

Tesla's CEO Elon Musk recently tweeted that the company was only a few months away from filing bankruptcy when it was still struggling to bring its now best-selling vehicle, the popular Model 3 sedan, into the market. According to Elon Musk's post, the closest that they had away from bankruptcy was "about a month."

Elon Musk then explained that the Model 3 ramped them with extreme stress and pain for a very long time ever since the mid 2017 to the mid 2019 due to the production costs and the logistical nightmares. Tesla was reportedly in a very serious cash crunch as the losses started to pile up and the company struggled just to hit the many production targets for the known Model 3.

Elon Musk joked about bankruptcy on April Fool's Day 2018

Although Elon Musk never disclosed that the company was eventually going to file for bankruptcy, he still joked about it a separate tweet that he posted exactly on 2018's April Fool's Day. As of today, Tesla's struggles now seem like ancient history.

The story was reported by CNN Business and according to the article, Tesla now has reported sustained profits, a strong industry-leading profit margin, and also a very strong cash flow. The stock has also responded with much positivity as Tesla shares have soared over 400% as of this year.

Tesla Model 3 becomes top-selling car in California

According to an article previously reported by CNet, Tesla's once nightmares Model 3 has even become the top-selling car in California as of June 1 this 2020 despite the pandemic. This data, along with Tesla's recorded stock price as of the moment, shows how the company is capable of competing against not just other electric vehicles as reported by Cleartechnica, but also against conventional gasoline and diesel cars in general.

With Europe planning to switch towards complete EVs by the year 2050, even the shift of transportation looks like it is swaying in Tesla's favor. With Tesla's upcoming Gigafactory in Berlin, the car maker aims to be able to supply the demand for EVs in Europe.

One reported reason as to why Tesla has not dominated the UK market is due to the lack of supply unable to match the demand. This need for Tesla has prompted them to construct the reportedly largest gigafactory in Berlin in order to fulfill the UK demands and have a better logistical foothold in the area.

As of the moment, it's hard to imagine that Tesla was only a month away from bankruptcy.