05 August, 2017
The electric vehicle maker has cautioned that its rollout of the Model 3, its first attempt at a mass-market auto, would face challenges. The company said it is actually seeing an increase in orders for its luxury Model S vehicles, despite the launch of a cheaper model. "If you go to our stores, we don't even want to talk about it, really, because we want to talk about the thing that we can supply", Musk said on a company earnings call with analysts on Wednesday, Aug. 2.
Tesla burned through a record amount of cash in the second quarter as it prepared to unveil its Model 3 sedan. That's primarily down to Model 3 equipment and Gigafactory 1 construction, though expansion of the Supercharger network - along with its dealership and servicing networks - will also contribute to that.
HSBC Tops First Half Estimates, Boosts Share Buyback Program by $2 Billion
Europe's biggest bank reported a pre-tax profit of $10.2bn (£7.8bn) for the first six months, up by about $500m. The latest share buyback lifts the total buybacks by the bank the this year to $5.5 billion.
Model 3 reservations haven't reached 500,000, unlike a figure he told reporters last week, but are a net 455,000, Musk told analysts on the call.
According to an analyst from the premier bank and financial institution, Morgan Stanley, the company has been focused on the huge vehicle demand, especially with the heightened hype and popularity of the cheaper alternative, the Model 3. Production in the fourth quarter will then jump to building 5,000 Model 3s per week, and finish the quarter building 10,000 units per week. The 62 percent annual sales growth trend implies that Tesla S and X shipments will top 100,000, eviscerating the bearish traders that claimed Tesla's all-electric vehicles have lost their novelty and the company will eventually run out of cash.
Moving ahead, Tesla continues to expect Model S and Model X deliveries to increase in the second half of 2017, as compared to the first half of the year. It's betting that the $35,000 Model 3, with a 220- to 310-mile range and price tag close to the USA median, will be the auto to do it.
Shares in the automaker popped more than 7% on Thursday, a day after Tesla reported second quarter earnings that saw revenue double and the net loss attributable to shareholder expand to $336.4 million from $293.2 million in the same period previous year. This allows for more efficiency and less costly production.