BUFFALO, NY - It's been a tough summer for Elon Musk.
One of his companies, Space X saw its rocket Thursday explode on the launch pad destroying a $200M Facebook satellite. It may have also cost the space company more than $100M for the lost rocket.
And that may be the smallest corporate headache Musk has faced lately.
He has been trying to shepherd two more of his companies, Tesla and Solar City, through a merger. That requires the filing of lots of paperwork with the Securities and Exchange Commission. And in those papers, we learn some things about SolarCity's still-under-construction solar panel factory in South Buffalo.
The good news is that SolarCity thinks the plant will be operational by mid-2017. That's earlier than expected.
But also within the filed paperwork is an admission by the company that the factory will lose money to start. Break even on the operation is not expected until 2019.
That's not encouraging news for a company that posted a record second quarter loss and is on pace to lose a billion dollars in 2016.
And Jim Heaney of Investigative Post points out SolarCity will also need to find a lot of money, fast.
“The balance of this year and next year the filings said they’re going to need to raise $5.9 billion dollars which is a huge amount of money obviously.”
Options for the company may include issuing new stock, borrowing or both.
Also tucked inside the SEC papers is a notation that for short time, SolarCity considered selling the South Buffalo plant. It appears the idea was only briefly considered and then dismissed.
But did the state of New York know SolarCity has sale of the plant on the table for a time?
SUNY Polytechnic is the lead agency for the $750,000,000 project. Spokesman David Doyle did not answer our question about whether state officials were aware of the sell-the-plant notion being kicked around SolarCity, but did offer this statement:
"The SEC requires in its filings to provide worst case scenarios and what potential challenges and obstacles could be. As disclosed, it was an internal discussion and hypothetical that was never a serious option and dismissed as not viable."