Tesla declined to comment on the memo, but did confirm that they have been seeking price reductions from suppliers for their recent projects.
The company asked suppliers to refund a meaningful amount of the money it had spent with them since 2016, according to a memo leaked to The Wall Street Journal. What's more, a recent teardown of the Model 3 suggests that Tesla's mass market EV might be far more profitable than initially anticipated.
Tesla already cut its workforce by 9% in June, and Musk reportedly promised to slow spending.
In a memo issued to suppliers, Tesla said those who offered the cash back would be investing in the company's long-term growth.
Tesla burned through more than $700 million in the first quarter - leaving it with $2.7 billion cash on hand.
"This is troubling for us to hear", said Morningstar analyst David Whiston in a note to clients. Now that Tesla has achieved its target of 5,000 units per week production rate, the company is in a better position to negotiate with suppliers.
The remainder of our discussions with suppliers are entirely focused on future parts price and design or process changes that will help us lower fundamental costs rather than prior period adjustments of capex projects.
Last month, Tesla said it was cutting several thousand jobs to become sustainably profitable without endangering the ramp up of Model 3 production.
As a refresher, Musk told Bloomberg: "Once we break through to mass-market cars, where mass-market is on the order of a quarter million vehicles per year, I can not see us doing a 1.2-million-vehicle program of one particular model".
Tesla intends to stretch that goal to 10,000 per week.
An analyst at Baillie Gifford, Tesla's third-largest institutional shareholder, told the Journal the firm is "divided" on whether Musk is the right leader for Tesla.
While it may be a bad sign, going after suppliers is just the latest thing Tesla is doing to get cash and get the Model 3 to Tesla's eager buyers.