For Tesla shareholders, SolarCity comes with deepening losses

SolarCity may soon become part of electric car maker Tesla, in a merger aimed at creating a sustainable energy superpower. The $2.6 billion deal has drawn some criticism due to the fact that Tesla CEO Elon Musk is also the chairman of SolarCity.

Some observers have called the deal a “bailout” for SolarCity, whose solar panel installation business has burned an increasing amount of cash. As this chart from Statista shows, SolarCity’s losses have been growing at a much faster rate than its revenue in recent years. Tesla shareholders presumably believe in the the company’s environmental mission. But unless Musk can figure out a way to make the combined companies operate more efficiently, that mission is about to get a lot more expensive for Tesla investors.

NOW WATCH: Elon Musk just unveiled Tesla’s ‘top secret’ master plan — here are the details

NOW WATCH: Tech Insider videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at