Tesla lowered its full-year sales forecast to a range of 50,000 to 55,000 cars.
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Tesla will produce the Model X on the same general assembly line as its Model S sedan, which could slow down overall production if there are snags during the ramp-up of the new product, CEO Elon Musk and soon-to-depart CFO Deepak Ahuja wrote in a letter to shareholders. “We only want to deliver great cars, so we don’t want to drive to a number that’s greater than our ability to deliver high-quality vehicles”. It closed up 1.4% to 270.13 in Wednesday’s regular session. He said the company plans to sell about $40 million of the batteries in 2015, then jump to $400 million to $500 million in 2016.
Tesla is also gearing for a new project to adapt vehicle batteries to store power in homes and businesses. The average of estimates compiled by Bloomberg was for a 60-cent loss.
Tesla may not be cash-flow positive until early 2016, Ahuja said.
The Model X had previously been targeted to go on sale in 2013, then by the end of 2014.
Once production of the Model X has ramped up, Musk said, Tesla’s factory would have capacity to build 1,000 units of the Model S and 1,000 units of the Model X per week.
States like California see energy storage as a critical tool to better manage the electric grid, integrate a growing amount of solar and wind and reduce greenhouse gas emissions.
But Tesla said it’s not totally confident that suppliers will be able to match its production demands, so it lowered expectations for its total annual sales this year. Tesla’s China sales fell to 171 cars in June from 338 in May and 948 in April, it added.
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Stifel analyst James Albertine said in a note ahead of Tesla’s results that he expected the company’s spending would “manifest itself as more cash burn in the eyes of disbelievers… on 2Q15 results”, and that “could weigh on shares in after-hours trading” absent any material updates on Model S and Model X deliveries for the rest of the year or any significant changes in Tesla’s global growth strategy. The world’s largest vehicle market has the potential to become Tesla’s biggest customer base, too, but concerns about charging and early mistakes by the sales staff stymied the company’s entry. The company has delivered 21,562 vehicles in the first half of the year.
