Why Apple shouldn’t purchase Tesla image

Every now and then, another rumor or article appears about that technology marvel – namely Apple – and it’s desire/need/strive/idea about acquiring the gem of electric car companies – Tesla Motors.

Why many are proponents of the idea and languish at the site of such a promising “marriage”, let’s step back a little and see some counter arguments. First and foremost, as the brilliant billionaire, entrepreneur, co-founder and CEO Elon Musk acknowledged during the latest conference call – building cars is actually hard. Apple is very good at having others building the products it owns – so having Tesla build cars would come natural – but keep in mind that there’s a difference between having Chinese workers produce iPhones by the millions and having a company produce just thousands of cars. The scale of the processes itself would be a massive hindrance.

Then there’s the problem with Apple’s US finances – what issue you might wonder? Well, even as the technology company has $155 billion in cash and investments, Apple has a negative cash balance in its home country: $35.3 billion in debt on $18.1 billion cash. And Tesla is today valued at around $30 billion – if it pays just a 25% premium and adds the carmaker’s own $2.5 billion in debt the total would be out of reach – $40 billion.

Via Forbes