The Strategist

Elon Musk is going through a bad patch

09/02/2016 - 10:32

Cargo rocket Falcon 9 of Space X, owned by Elon Musk, exploded on a launch pad at a Cape Canaveral’s spaceport, reported television channel MSNBC. Launch of Falcon 9 was scheduled for September 3 with aim to put Israeli communications satellite Amos-6 into the orbit.
Local department of the USA Emergency services are assuring that there is no danger for people in the nearby vicinity.

The explosion came during engine tests. Many observers saw thick black smoke rising above the horizon. Witnesses told that they heard several pops, which shook office buildings nearby, in the first minutes after the first explosion.

There are no official reports of casualties or injuries. This is the second serious incident with the Falcon 9. In June last year, the missile exploded on 139 seconds of flight due to faulty fuel system.

Representatives of the company have already given comments. "A violation of normal functioning was observed during preparation for today's test launch, which led to loss of the unit and its cargo," – said the company in a statement.

Earlier, it was reported that two companies of Elon Musk - Tesla Motors Inc. and SolarCity Corp. - encountered financial difficulties and lack of resources for a previously announced merger.

Manufacturer of electric vehicles Tesla Motors has notified the US financial authorities of need to find additional funds. Tesla has to find this sum to pay $ 422 million to the company’s bond holders for the III quarter. Additional funds are expected to be raised by the end of the year. Among other things, purpose of raising additional capital is to finance a merger with energy company SolarCity.

At the same time, 15 institutional investors refused to buy shares or invest in development of SolarCity during the last couple of weeks. The company faced a liquidity shortage. As of June 30, size of available free funds of SolarCity was $ 146 million compared with $ 421 million a year earlier.

In July it was reported that Tesla Motors Inc. again failed to implement a plan for supply of electric cars in the II quarter. Instead of projected 17 thousand cars, the company has released only 14370, Bloomberg reported. Analysts have already questioned the company’s annual plan for production of 500 thousand vehicles by 2018.

One of Elon Musk’s important promises was increase in annual output of electric cars up to 500 thousand pieces. by 2018. Attainability of this goal raises great doubts as Tesla Motors will barely be able to deliver 80 thousand cars for the year.

Tesla Motors plans to release 50 thousand cars in the second half of the 2016. If this suddenly happens, the company will manufacture 79180 electric cars in total, while the target is 80-90 thousand vehicles before the end of the year.