Tesla Sued By Supplier For Not Paying Its $1.77 Million Bill

Just days after Elon Musk postured as if Tesla didn’t really need the cash that it was raising, a new lawsuit has been filed against the company, by a French metal supplier, alleging that Tesla owes them $1.77 million. The suit was filed in California's Northern District.

Lebronze Alloys has provided a metal part for Tesla's electric motor since 2016, but is having difficulty collecting on the $1.77 million (€1.55 million) that it is owed by Tesla.

Their lawsuit against Tesla states:

 "LBA made numerous efforts to get Tesla to pay the amounts Tesla owed to LBA. LBA convened meetings, sent e-mails and letters, and initiated numerous telephone calls in an effort to get Tesla to pay what it owed, to answer any questions Tesla may have had, and to resolve any issues. In addition, LBA demanded reasonable assurances of performance by Tesla."

Another interesting aspect of the lawsuit is that it also may have also inadvertently offered a nod to lower guidance from Tesla. The original 2016 agreement had Tesla agreeing to buy parts for up to 1.5 million vehicles. But that agreement was amended in February 2019, with the forecast changed to just 250,000 vehicles. Whether this is a result of new lowered guidance, or Tesla taking receipt of orders between 2016 to 2019, remains to be seen. 

The lawsuit continues:

 "On April 17, 2019, Tesla, without notice, requested an immediate telephone conference call, during which Tesla purported to give verbal notice of termination of the Agreement and the Amended Agreement, without advance notice and contrary to the terms of the Agreement and the Amended Agreement. This constituted a breach, repudiation and anticipatory breach of the Agreement and the Amended Agreement."

Tesla's relationship with suppliers continues to look volatile. After asking, in July 2018, for concessions by its suppliers, 18 of 22 executives surveyed at automotive supply companies said that Tesla was "a financial risk to their business". More than a third of those surveyed said they were worried about a Tesla bankruptcy.

PlainSite has provided a link to all Tesla vendor non-payment lawsuits outstanding. As of now, there appears to be 22 cases outstanding.

Here is a look at the full lawsuit.

Lebronze Alloys vs Tesla by on Scribd