Model 3 production delays may require Tesla to raise more cash

Model 3 production delays may require Tesla to raise more cash

Now, the company says it expects to be producing 2,500 Model 3s weekly in the first quarter 2018, and 5,000 weekly by the end of June.

Model 3 production is accelerating Tesla had initially predicted to reach the milestone of 5,000 vehicles per week in December, but in November deferred the target to the end of the first quarter.

The delay sent shares of the Palo Alto, California-based company down 3.5 percent in pre-market trading Thursday.

Many analysts believed Model 3 production would ramp up significantly in the fourth quarter this year and that roughly 4100 examples would be delivered. As we've talked about before, Jonas' approach to monitoring Tesla reminds us of a parole officer who falls in love with their parolee. The electric vehicle maker said in an online statement Wednesday it expects to produce 2,500 a week by the end of March.

In the months leading up to launching the Model 3, Tesla raised at least $1.2 billion through an offering of stock and convertible debt in March and another $1.8 billion by tapping the junk-bond market in August. In Q3 2017 only 220 Model 3 c.

Tesla is burning billions in cash as it struggles to achieve its vision of mass-market electric cars powered by Tesla-brand solar roofs through Tesla-brand home storage batteries. The highly automated assembly line for the Model 3 means any technical problems slow assembly dramatically.




Building the vehicle efficiently and delivering it without delays to customers is also critical, as the money-losing company faces high cash burn.

The Model 3 notwithstanding, Tesla did manage to enjoy a successful quarter overall; the company delivered more than 29,800 vehicles over the past three months, setting an all-time quarterly record in the process.

Tesla announced delivery and production numbers for the fourth quarter of 2017 on Wednesday.

Analysts said on Thursday they continue to believe that sales of the Model 3 sedan could transform the niche automaker into a mass producer, giving it an edge over a host of rivals such as General Motors and BMW who are entering the nascent electric vehicle market.

The Model 3 is expected to arrive in the United Kingdom in 2019.

"Tesla has really lofty goals for automation", said Tasha Keeney, an analyst at ARK Investment Management, which holds Tesla shares. Yet in the same period, 63,000 were cancelled, Elon Musk said during Tesla's quarterly conference call in July-a figure he saw as insignificant as it happened over 12 months. The company said it made significant progress on speeding up manufacturing of the sedan late last month, producing 793 units in the last seven working days.

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