Buy A Tesla Before The Automaker Goes Bust, Says Bob Lutz

Bob Lutz, outspoken automotive industry veteran and former vice chairman of General Motors, claimed that Tesla would be going out of business last November. That stirred up some controversy. Now, Lutz has returned to the limelight by stating that collectors should purchase a Tesla Model S before the electric automaker goes bust.

According to a report by the Los Angeles Times, Lutz passed on a piece of advice to an audience full of vintage-car collectors in Scottsdale, Arizona: purchase a Model S “while they’re still available.” Lutz has never been one to hold back and usually tells it like it is, so you might want to heed his advice.

Lutz apparently is a massive fan of the electric sedan. “A Model S, especially with the performance upgrades, is one of the fastest, best handling, best braking sedans that you could buy in the world today,” he said at a forum. “The acceleration times will beat any $350,000 European exotic.”

When it comes to Elon Musk, however, Lutz believes that Tesla’s CEO “hasn’t figured out the revenues have to be greater than costs… when you are perennially running out of cash you are just not running a good automobile company.” Lutz does have a point there, as the EV company was reportedly going through roughly $480,000 every hour last November.

Unfortunately, Lutz doesn’t see anything changing in Tesla’s future when it comes to fund, although he did say that he is “semi-serious” about suggesting collector’s purchasing a Model S.

One way for Tesla to prove Lutz wrong is to make sure that the Model 3 is a hit, which would involve fixing the electric sedan’s issues and start rolling them out in serious numbers.

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  • UGH! Another Tesla Story

    • Dr Strangefinger

      All hail Tesla!!!

    • Bash

      You don’t talk much, don’t you?

  • Bo Hanan

    Lutz betta be careful before Elon puts an electric hit out on his azz.

  • LWOAP

    Eh…..even if Tesla doesn’t go bust, you could probably pick up a used Model S for far cheaper. If I was to choose a Tesla right now, it would be the original roadster.

    • Last time I check in UK, Tesla Roadster price start to gained up, since people thought it’s cool to have the genesis of modern electric car.

  • gor134

    Best handling? Really? And I highly doubt Tesla is going bust any time soon.

  • Rich Money

    …said the guy who green-lighted the Pontiac Solstice. He’s always right.

  • benT

    Lutz – paid employee; advocating you buy a car that is (in his estimation) going out of business ?)
    Musk – risk taking with his own; entrepreneur ; billionaire from own sources

    • Squeaky_1

      Tesla is the receiver of hefty subsidies from the govt, has been all along . . . not that well publicised. What can’t go on forever, won’t. I’m talking about them burning cash and never making a profit. We have seen how that ends many times before. I love the car but the business model is heavily flawed unfortunately.

      • benT

        ALL manufacturers receive Government funding in the USA.

        “……the Bush and Obama administrations allocated $US80 billion to direct assistance under the Automotive Industry Financing Program. This included rescuing automotive firms’ financing operations, such as the General Motors Acceptance Corporation (GMAC). There were also debt guarantees. (Australian Government) Treasury notes that it has recouped almost $US51 billion of the $US80 billion allocated to the program.”

        None of the US subsidies to the oil industry are included in the above. You can bet ALL your dollars that the oil industry subsidies from the US Govt benefit the major manufacturers.

        Tax breaks not included in any calculation either.

        Brent Snavely , Detroit Free Press Published 3:06 p.m. ET Dec. 30, 2014
        https://www.usatoday.com/story/money/cars/2014/12/30/auto-bailout-tarp-gm-chrysler/21061251/

        General Motors
        Treasury provided a total of approximately $51 billion to GM through TARP, under a loan agreement

        Chrysler
        In total, Treasury committed $12.5 billion to Chrysler under TARP. Un

        Ally Financial (formally GMAC)
        As part of the government’s assistance to the automotive industry, Treasury also invested a total of $17.2 billion of TARP funds in Ally Financial (formerly GMAC). Founded as GM’s finance subsidiary in 1919, Ally has been a primary source of financing for GM’s dealers and consumers for over 90 years. Treasury d

        Chrysler Financial
        In January 2009, Treasury announced that it would lend up to $1.5 billion to a special purpose vehicle (SPV) created by Chrysler Financial to enable the company to finance the purchase of Chrysler vehicles by consumers. In July 2009, Chrysler Financial ful

        Auto Supplier Support Program (ASSP)
        Treasury also provided loans through the Auto Supplier Support Program (ASSP), to ensure that auto suppliers received compensation for their services and products, regardless of the condition of the auto companies that purchase their products. Treasury has recovered all amounts invested under this program

        Auto Warranty Commitment Program (AWCP)
        In the Auto Warranty Commitment Program (AWCP), Treasury provided loans to protect warranties on new vehicles purchased from GM and Chrysler during their restructuring periods. Treasury has recovered all amounts invested under the warranty program.

        US Government Treasury Statement
        https://www.treasury.gov/initiatives/financial-stability/TARP-Programs/automotive-programs/pages/default.aspx

      • benT
    • smartacus

      Musk- 4.9 Billion in taxpayer funds

    • Jon Doe

      You back again spewing Bile Fat Boy.

    • benT
  • GobbleUp

    Always respected Bob but he’s been beating this drum too long. Must have some personal agenda.

  • Lutz does have a point…you cannot forever have your expenses greater than your revenues…from reports, it took Toyota 10 years to earn profits and its return-on-investment on the Prius…it could shoulder these massive losses because of profitability of its other cars and Japanese government subsidies…according to Tesla’s own public financial reports, it suffers massive losses for each Tesla sold…there is only so much appetite for risk that investors will be willing to take…after a while they will say, show me the money and it has been “after a while”…

    • exeptor

      You made some good points, but in the actual top of the top 1% where the future is decided the things are more complex than money. In case of Tesla we are talking about the company which more or less started the EV hype. Right now most of the big car manufacturers have EV in their future plans. Not t mention scandals like Dieselgate which makes the gap between now and the all EV future smaller. Countries like Norway will ban all ICE cars in 2025. I guess other will follow. No need to mention that Tesla is about to produce more than 50% of the car batteries when Megafactory become finished. I know that there are lots of “when”-s and “if”-s but the entire picture is not that bad. I guess these investors knows much more than we do.

      • haudit

        Tesla is the dot com boom of the 2010s. If they can’t get a handle on cost vs revenue and start making a profit on the cars they sell, eventually they will go bust, regardless of how many batteries they manufacture.

  • smartacus

    i disagree;
    this will not be a collector car.

  • Sparkopolo

    This from the man whose guidance among others at the helm of GM ensured the demise of Pontiac, Saab, Hummer and left GM a pathetic shadow of its former majestic self.

  • Marty

    As a former board member of both GM and Chrysler, Lutz should now all about dying car brands.

    But in the big picture, Tesla’s task is already done. The survival of Tesla is irrelevant when you can buy an ordinary car with an electric engine from the brand of your choice.

  • Bob Lutz comment is more like either you agree or not. But again his recent automotive endeavor hasn’t gone well as well. VLF is hardly a success tbh, with Force 10 being the car that they actually sold.

  • Jon Doe

    Battery prices are going to be skyrocketing in the near term. How do you produce a car for the masses thats un-affordable. This is a business plan that has no hope of succeeding. Electric cars are toys for fat cat rich virtue signalers.

  • LeStori

    Former Vice Chairman of Global Product Development of General Motors.,Bob Lutz, would know about bankruptcy. Every where GM went the rubbish was sure to go. And in 2009 GM went belly up.

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