Do you even business, bro?
In the three months spanning October to December 2017, vaunted American electric carmaker Tesla lost the equivalent of $9.6-million a day (or US$7.5-million), culminating in a Q4 2017 loss of a whopping $867-million (US$675.4-million). You’d think that taking that big a financial blow would force upon you some humility, but much where his SpaceX rocket went, Elon Musk is keeping his eye trained towards the skies.
“We might aim for something like maybe 1-million units a year, just for the Model Y alone.” — Elon Musk, CEO, Tesla Inc.
*taken from an earnings call with analysts last Wednesday
The Q2 2017 losses are the largest posted (so far) by the company, and is down largely to the non-delivery of its massively-popular Model 3 saloon, due to “production bottlenecks” that Musk says is nothing short of “hell.” However, Tesla was quick to point towards its 36% improved revenue pool, thanks to increased delivery of its Model S and Model X luxury models, which enjoy steady demand and fatter profit margins.
More good news came from Tesla’s energy storage division, which reported a 6% improvement over the earlier quarter. However, Tesla’s continued leveraging on ‘ZEV Credits’ (or credits given to them for selling zero-emissions vehicles), analysts say, paint a slightly rosier picture of proceedings. Over the last quarter, Tesla racked up $230-million (US$179-million) in ZEV credits (which they can sell to manufacturers that have failed to meet their minimum requirement of earned ZEV credits for actual money), which is a huge leap over the same period the year before, where they only racked up $25.7-million (US$20-million).
When the Model 3 first arrived on the scene, many were amazed by Tesla’s ability to rack up near half a million bookings within a matter of months. However, that sudden surge in demand from the company has seemingly left it unable to cope, pushing back delivery dates further and further. If you were to order a Tesla Model 3 today, don’t expect to be assigned a VIN number for about 2 years.
Just shy of 30,000 cars were delivered in Q4 2017, consisting of 28,425 units of the larger and more luxurious Model S and Model X cars, and just 1,542 units of the far more popular and affordable Model 3. This is a far cry from the 5k/week production target that Elon Musk had previously set for the 3, achievable by the end of 2017.
But hey. When you’re in the ninth circle of hell, the only way is up, right?