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John Wang
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Stocks
April 2 14:57

Tesla’s plans for 2020 are cancelled

The company’s reserves help keep the business running.
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Tesla admits that the coronavirus pandemic has made it impossible to accomplish its plans for 2020. However, the company relies on its reserves to go through the crisis. 
According to the forecast by the Bernstein analyst, the pressure of lockdowns and falling demand is unlikely to influence Tesla’s business for at least two more quarters. The company has planned to sell and deliver
500,000 cars this year - now this target looks almost unachievable. Nevertheless, the analyst believes that Tesla can still sell up to 425,000 cars.
The company also has sufficient cash reserves to wait out the crisis. Its reserves are unlikely to go lower than US$6.6 billion. Tesla is also relatively unburdened by debt - it has only US$100 million of debt coming due in 2020 and convertible bonds worth US$1.4 billion coming due in 2021.
The company’s situation will be easier to understand next week, when Tesla releases its quarterly report.