Tesla, Inc. (NASDAQ: TSLA), a manufacturer of electric vehicles and solar panels, is widely regarded as an American clean energy success story. Its market capitalization has exceeded $80 billion at its peak, and it operates factories in California, Nevada, New York and China. Yet recently released documents obtained by PlainSite affiliate Think Computer Foundation reveal that the entire company is at this point built on a massive, multi-billion dollar fraud orchestrated by its CEO, Elon Musk, who for years has gone to extreme lengths to conceal his unlawful acts from shareholders. In parallel with this core fraud, under Musk’s leadership, Tesla defrauded taxpayers in New York and California out of more than 1.2 billion dollars, while producing products with serious and sometimes fatal quality defects that will likely put the company at risk in a projected 300 new lawsuits in 2020.

I>n 2016, Tesla acquired SolarCity Corporation, a company run by Musk’s cousins, Peter and Lyndon Rive, for $2.6 billion. The acquisition, which made no financial sense for Tesla, was a bailout for Musk and his relatives, whose companies faced near-certain bankruptcy without emergency financing.

Since the merger, Tesla has been a financial disaster. In its nearly seventeen years of existence, the company has never turned an annual profit. Even with billions of dollars of subsidies from governments worldwide, it has managed to incinerate money at an astounding pace. Despite having the lowest 5-year trailing earnings per share growth of any NASDAQ company worth more than $50 billion, it also has the highest forward price-to-earnings ratio in the class. Tesla’s astounding overvaluation is thanks in large part to a coterie of devoted followers whose television appearances and often fake social media accounts have whipped up a frenzy of hype. Many have also targeted critics and short sellers with vitriol and harassment. While the company’s advocates speak of “moats” that give Tesla a competitive advantage, the truth is that Tesla has virtually no protectable intellectual property and it has pledged to open-source its relatively few patents, besides. Management is in shambles. Meanwhile, the coming decade is certain to feature new competitors in the electric vehicle space.

Simply put, Tesla cannot be understood through traditional quantitative metrics because its disclosed numbers are largely fraudulent. Tesla is a broken company, effectively a Ponzi scheme, founded upon the enthusiasm of brilliant hobbyists who unknowingly partnered with a self-described narcissistic “bait and switch[er].” Today, Tesla’s story is Musk’s story. And that story is much different than the PR narrative.

https://www.plainsite.org/realitycheck/tsla.pdf