Tesla’s loss rose 84 per cent to US$282 million in the first quarter as it struggled with parts delays for the Model X SUV.
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CEO Elon Musk’s surprised investors Wednesday with a promise to make 500,000 cars per year by 2018, two years ahead of plan – a brash projection given that Tesla has missed smaller production targets in the past.
The company added: “We plan to incorporate our best technology into Model 3, yet keep it relatively simple to build at high volume and with high quality”. With a starting price of about US$35,000, it is to be the most affordable auto in the company’s 13-year history.
A Tesla logo on a Model S is photographed inside of a Tesla dealership in NY, U.S., April 29, 2016.
In a shareholder letter released after the close of trading, Tesla said that despite recent production concerns, it is “on track” for production and delivery of its Model 3 mass-market auto in late 2017.
Tesla confirmed earlier in the day that two key executives – Greg Reichow, vice president of production, and Josh Ensign, vice president of manufacturing – were leaving the company.
Analysts polled by Thomson Reuters estimated the company would post an unadjusted loss of $141 million on revenue of $1.6 billion during the first quarter. That would be up from 50,000 vehicles past year. While that sounds well and good, Tesla has been quite open with the fact that it doubts it’ll hit the Model 3’s July 1st, 2017 production kickoff date.
“The Model 3 is trying to take a lot of lessons from the Model X”, whose fancy falcon-wing doors have occasionally malfunctioned, drawing customer complaints.
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The call was primarily to announce Tesla’s Q1 results, with the firm reporting a $283 million loss during the start of the year. Musk even said that he has prepared a sleeping bag near the production line, and if he wants Tesla to reach its ambitious target, he may have to use that sleeping bag often. The company has been spending money to increase its manufacturing facilities. It appears that the EV company’s goal for 500,000 productions of segments is causing worry for the stakeholders.
