Tesla CEO Elon Musk hasn’t exactly said his electronic vehicle (EV) company was headed toward bankruptcy, but he did loosely use the word “bankrupt” during a recent interview, reported CNN (1). Like most companies that are working their way out of the pandemic, Tesla has found itself in serious financial trouble as a result of shutdowns and supply chain issues.

 

Here’s what Elon Musk said regarding Tesla’s financial losses and how sources are interpreting it.

 

During a recent interview with a Tesla owners group, Musk said that “the past two years have been an absolute nightmare of supply chain interruptions, one thing after another.” Musk added, “We’re not out of it yet. That’s overwhelmingly our concern is how do we keep the factories operating so we can pay people and not go bankrupt,” as reported by CNN.

One of the losses Tesla is experiencing reportedly stems from its Shanghai factory that was closed down for several weeks as a result of the COVID-19 pandemic. The company is also said to be incurring “billions of dollars in losses” as its factories in Germany and Texas struggle with the ongoing supply chain issues. 

These issues have allegedly left the company “with puny output so far,” CNN reported.

 

Could bankruptcy be on the horizon for Tesla?

 

According to Gordon Johnson of GLJ Research, “bankruptcy is a real risk for these guys,” referring to Tesla. Johnson not only acknowledged that Tesla could be facing bankruptcy while speaking with CNN Business last week, but he also attributed it to the EV maker having “a lot of their cash locked up in China.”

In fact, Johnson shared with CNN that Tesla had to cut roughly 10 percent of its salaried staff, which is a “let tell-tell signal” that the EV maker is in trouble. 

 

When should a company file for bankruptcy in Alabama?

 

Bankruptcy can be an extremely beneficial tool for business owners to utilize when they are unable to manage their debt, or their losses outweigh their income. If your business has taken a financial hit and you don’t see any sign of recovery, talk with an Alabama bankruptcy lawyer about the different options that may be available to you.

Hill, Gossett, Kemp & Hufford, P.C. is a bankruptcy law firm with multiple locations throughout the state of Alabama that can provide you with advice and even guidance should you decide you want to file for bankruptcy. To schedule a time to speak with a Moody, AL bankruptcy attorney nearest you, contact Hill, Gossett, Kemp & Hufford, P.C. at any of their office locations listed down below.

 

Disclaimer: No representation is made that quality of legal services provided is greater than the quality of legal services provided by other attorneys.

 

Hill, Gossett, Kemp & Hufford, P.C. can be reached at:

 

Moody Office

2603 Moody Parkway, Suite 200

Moody, Alabama 35004

Phone: (205) 640-2000

Website: www.hwhlawgroup.com

 

Leeds Office

7900 Parkway Drive

Leeds, AL 35094

Phone: (205) 699-5500

 

Springville Office 

6441 U.S. Highway 11

Springville, Alabama 35146

Phone: (205) 467-2225

Source:

  1. https://www.cnn.com/2022/06/23/cars/elon-musk-tesla-losses-bankruptcy-threat/index.html

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