It’s the question that puzzles pundits and makes short-sellers see red: Why isn’t Tesla broke yet? The company has posted losses almost every quarter since its founding, but not only does it remain in business, it steadily rolls out new products and opens up new markets, as Tesla fanboys cheer and the stock (over the long term) has soared.
Many have sought an answer to this consequential question – the latest is the Youtube channel The Rest of Us, in a charmingly childlike animated video that explains Tesla’s unique financial model in the simplest of terms.
Above: Exploring the financials at Tesla (Youtube: The Rest of Us)
In short, Tesla isn’t broke because it isn’t running out of cash. Theoretically, losses can continue indefinitely, as long as the kitty is regularly replenished. But where does the cash come from? Some comes from the sale of vehicles – Tesla earns a healthy margin on each car it sells (despite the disingenuous claims of some naysayers), and it sometimes even gets cash in the form of deposits before it even builds a vehicle (a clever financial feat that’s the envy of other automakers).
However, even as Tesla rakes in piles of money from product sales, it shovels out much more. Whence cometh the cash to top up Tesla’s reserves? Some is borrowed (debt financing), but more comes from the stock market (equity financing). Why do investors keep buying shares in a company that perennially loses money? Because savvy investors don’t base their decisions on what a company is doing today, but on its prospects for the future. Tesla is focused on the future like no other automaker, and has steadily invested huge sums to prepare for a future in which it sees huge opportunities.
Many articles about Tesla and other high-flying tech companies use terms such as “burn rate,” which can give the false impression that the cash that’s coming in just disappears, frittered away, heedlessly tossed to the winds, flushed down the…you get the idea.
Back in 2016, Vincent Paver, writing in Medium, made some good points as he explained that, far from throwing its cash in the fireplace, Tesla has invested much of it in capital goods – handy things like factories, machine tools, robots and charging facilities. Paver points out that, at the time of writing, Tesla had “burned” $1.6 billion over the last 12 months, but the book value of its equipment had increased by $2.8 billion over the same period. Other expenditures, such as vehicle development costs and employee training, may not result in tangible bricks-and-mortar assets, but they are also investments, as they allow Tesla to create new products that it can sell for more lovely cash.
Paver concludes that what we have here is not a company that is recklessly flinging away money, but one that is “in a capital-intensive business, and is [investing] substantial but appropriate sums of money on equipment and capacity expansion, tied directly to strong end user demand.”
And there you have the real key to why the callow California carmaker hasn’t gone belly-up, and won’t if current trends continue. The demand for Tesla’s products is strong – the backlog of Model 3 orders remains huge, and Models S and X continue to sell at a steady pace. Yes, not being able to produce vehicles fast enough to meet demand is a problem, but the reverse would be much worse. If Tesla’s waiting list disappears, and sales figures start going down, then it will truly be time to worry about the company’s cash flow.
Paver calls Tesla “a rare example of a public company aggressively chasing a market opportunity many multiples greater than its current scale.” Elon Musk’s new compensation plan, which was recently approved by shareholders, envisions the automaker growing to a market cap of $650 billion, which would make Tesla one of the five largest companies in the US. If and when that happens, rest assured that plenty more cash will be burned along the way.
===
Note: Article originally published on evannex.com by Charles Morris
Elon Musk
Tesla Cybercabs narrowly miss deadly Amazon cargo plane crash
An Amazon cargo plane crash near Miami’s airport stopped feet from dozens of Tesla Cybercabs.
An Amazon Prime Air Boeing 767 cargo jet overran the runway at Miami International Airport on Sunday afternoon, killing five people and injuring five more. The jet, operated by North Carolina based carrier 21 Air as Flight 7598, touched down around 2 p.m. after arriving from San Juan, Puerto Rico, then crossed the airport perimeter, plowed across NW 67th Avenue and struck multiple vehicles before catching fire, according to the Associated Press.
Photos and video from the scene show the aircraft’s nose stopped within meters of a fenced staging lot holding dozens of gold painted Tesla Cybercabs, the steering wheel free robotaxi Tesla began putting on public roads in Austin last week. Miami-Dade Fire Rescue has confirmed the plane struck “multiple vehicles” but has not said whether any Cybercabs were among them, and neither Tesla nor airport officials have addressed the fleet directly.
The Cybercabs had not yet entered commercial service in Miami. Tesla’s existing Robotaxi operation there runs on modified Model Y vehicles and has been unsupervised since Ashok Elluswamy confirmed the detail on X in July.
Footage of the plane crash from earlier today | #ONLYinDADE pic.twitter.com/iGoOtnd6cD
— ONLY in DADE (@ONLYinDADE) September 6, 2026
Elon Musk offered the briefest of reactions. Replying to a Zero Hedge post about the Cybercabs sitting so close to the wreckage, he wrote a single word: “Weird.” He has not commented further, and Tesla has not issued a statement.
The timing puts Tesla’s newest vehicle near an unrelated but highly visible tragedy just days after its Austin debut, a launch that had already drawn scrutiny from federal regulators. The National Highway Traffic Safety Administration opened an audit how Tesla certified the Cybercab as compliant with federal vehicle safety standards, a process Teslarati covered after the vehicle’s September 3 launch event. That inquiry concerns the car’s lack of a steering wheel and pedals, not the Miami crash.
Investigators from the FAA and NTSB are focused on the plane, not the parking lot beside it. Flight data reviewed by outlets including Simple Flying show the 767 touched down around 170 knots, well above the 135 to 140 knot range typical for the aircraft, though investigators have not determined a cause. Amazon said it is working with authorities and that its priority is the safety of everyone affected.
Whether any Cybercabs were damaged, and what Tesla plans for the fleet parked near one of the country’s busiest airports, remain open questions.
Featured
Tesla Cybercab is coming to Asia this month as US service officially begins
Tesla Asia says Cybercab will be on display in Hong Kong, Tokyo, Beijing and Shanghai this month.
Tesla’s Cybercab is heading to Asia. The official Tesla Asia account posted on X Thursday, inviting Cybercab fans to “Come experience the future of autonomy in Hong Kong, Tokyo, Beijing & Shanghai.” The post went up within hours of Tesla’s own Cybercab milestone in Texas, where the company said Thursday it had begun offering rides in across Austin.
Exact dates and venues for the Asia tour haven’t been released yet, though Tesla Hong Kong replied to the announcement with “Cybercab will be on display in Hong Kong soon,” while Tesla Japan’s response pointed fans to a sign up page for updates. Neither post mentions test rides or a service area, and nothing so far suggests Tesla is launching Robotaxi operations in any of the four cities. Based on how Tesla has run past Cybercab tours, in Europe in late 2024 and at US shopping centers that same December, the Asia stops are almost certainly static displays at Tesla stores or public venues as a means to stimulate buzz for its future driverless ride-hailing service in the big cities.
Cybercab will be on display in Asia this month!
Come experience the future of autonomy in Hong Kong, Tokyo, Beijing & Shanghai. pic.twitter.com/wGmmEastfX— Tesla Asia (@Tesla_Asia) September 4, 2026
The timing lines up with Tesla’s only prior Cybercab appearance in the region, a booth at the China International Import Expo in Shanghai last November, which Teslarati covered at the time. At that event, Tesla’s regional general manager for Shanghai framed the car as evidence of the company’s broader mission, a message Tesla has since formalized in its Master Plan Part IV, which states that “autonomous vehicles have the capacity to dramatically improve the affordability, availability and safety of transportation while reducing pollution, particularly in our increasingly dense global cities.” The same document is where Tesla lays out its “sustainable abundance” framing for Cybercab and Optimus alike, describing the two as the hardware behind an AI driven push to cut the cost of transportation and labor at scale.
Whether Cybercab actually operates as a robotaxi anywhere in Asia remains an open question, considering China has already pushed an autonomous ride-hailing market that’s run on homegrown players like Baidu’s Apollo Go and Pony AI. For now, the four city tour reads as a marketing push timed to Austin’s momentum.
Elon Musk
OpenAI cites distrust of SpaceX in decision to drop Cursor partnership
OpenAI will cut SpaceX-owned Cursor’s model access in November, citing Musk’s history of broken contracts.
OpenAI, the company behind ChatGPT, announced late Friday that it is ending its partnership with Cursor, cutting off the coding tool’s access to its models on November 12. The move comes two weeks after SpaceX completed its $60 billion acquisition of Cursor’s parent company, Anysphere, folding the popular AI coding assistant into Elon Musk’s growing SpaceXAI division.
In a post on its website, OpenAI said the decision came down to trust, not technology. “We cannot be confident that SpaceX will use our technology within our terms of service, based on our experience with Elon Musk’s companies violating contracts,” the company wrote. OpenAI pointed to two specific incidents: X, now part of SpaceX, allegedly breaking the terms of an existing OpenAI contract after Musk bought Twitter.
That lawsuit is the backdrop for all of this. Musk cofounded OpenAI in 2015, left the board in 2018, and sued Sam Altman and Greg Brockman in 2024, arguing they abandoned the company’s nonprofit mission for profit. A federal jury sided with OpenAI in May, finding Musk waited too long to sue rather than ruling on the merits of his claims. Musk said at the time he would appeal to the Ninth Circuit, calling the outcome a “calendar technicality” rather than a real judgment.
SpaceX’s interest in Cursor predates that verdict by weeks. The company first struck a deal with Cursor in April, securing an option to acquire it for $60 billion or pay $10 billion for joint development work instead. As Teslarati reported at the time, the logic was straightforward: Cursor was paying retail prices to Anthropic and OpenAI, two of its most direct competitors, every time a developer used its product, while SpaceX had idle capacity on its Colossus supercomputer, roughly the equivalent of a million Nvidia H100 GPUs, that Cursor could use to train its own models instead. SpaceX exercised the option in June, days after its own IPO, and the deal closed in mid-August.
Once it closed, Musk moved fast. On an all-hands call with more than 1,000 Cursor employees, he reportedly told staff that SpaceXAI’s Grok was playing catchup in the AI race, unlike Tesla and SpaceX in their own markets, and singled out Anthropic as the company to catch. Cursor CEO Michael Truell now reports directly to Musk inside SpaceXAI.
Losing OpenAI’s models leaves Cursor leaning harder on Anthropic’s Claude, which has its own compute agreement with SpaceX, and on Cursor’s in-house Composer model, the one SpaceX’s compute was supposed to accelerate in the first place. OpenAI framed the November deadline as maximum notice under its contract, and said it wants to “go above and beyond” to help developers through the transition. Whether Anthropic makes the same call is now the open question in AI coding.
Tesla ruined other cars for me: one year Model Y ownership review
Elon Musk rips ABC News over fatal NYC Tesla crash report
