It is not just equity that is in the eye of the storm for Tesla; the company's bond prices have been nose-diving in recent weeks.
$1.8 billion of Tesla bonds due to mature in August 2025 traded for 84 cents on the dollar on Friday, down from 98 cents a year ago. That means, yields doubled to 8.6% over the same period.
$2.7 billion of Tesla bonds are set to mature this year and the next, according to a Goldman Sachs research report. The total amount to mature before 2025 is more than $9 billion. Some analysts are apparently concerned over whether Tesla would be able to generate enough cash to make good on its debt obligations in a timely manner.
If the electric carmaker is able to ramp up Model 3 production and garner healthy sales from it, the company can potentially be expected to ease some of the financial pressures. On August 1, Musk told analysts that Tesla plans to pay off its debt instead of refinancing it. Musk also said that Tesla is unlikely to sell more stock for raising cash.