Tesla Misses Model 3 Production Target for First Quarter
In its Q1 report, Tesla touted it had “by far the most productive quarter” in its history. While that may be true, the automaker failed to meet its goal of making 2,500 copies of the Model 3 per week by the end of the quarter.
Tesla said it built 2,020 copies of the Model 3 in the past seven days. In the next seven days, Tesla only plans to make 2,000 copies. Although it ended up behind schedule, Tesla says it was able to double the weekly production rate of the Model 3 throughout the quarter by addressing bottlenecks, which involved temporarily shutting down factories to upgrade equipment.
Tesla says Model 3 production will “climb rapidly” in the coming three months. It’s sticking with its plan to make about 5,000 units a week by the conclusion of the second quarter. Then, Tesla expects things to really start picking up in the third quarter, when we should see high volumes, solid gross margin, and strong positive operating cash flow. Given Tesla’s history, we’ll believe it when we see it.
Tesla produced a total of 34,494 vehicles in the first quarter, breaking its record by a large margin, and 9,766 of these vehicles were the Model 3 sedan. The automaker says the entry-level model experienced a fourfold increase in output compared to the previous quarter.
“This is the fastest growth of any automotive company in the modern era,” Tesla says in the Q1 production and deliveries report. “If this rate of growth continues, it will exceed even that of Ford and the Model T.” Tesla also says the number of Model 3 reservations remained stable in the first quarter.
Amid slowdowns in Model 3 production, Tesla has seen its shares drop almost 18 percent since the beginning of the year. With news of the Q1 results, Tesla shares increased nearly 7 percent early Tuesday before leveling off at around a 3.4-percent increase, reports CNBC.
Despite what some experts have been predicting, Tesla says it will not need an equity or debt raise this year other than standard credit lines.