Tesla hits key production goal, but profits remain a question mark
Tesla sharply boosted the number of vehicles rolling off the assembly line between July and September, the electric car maker said Tuesday. It's a rare piece of good news in what has been a tumultuous few weeks for the company.
The company produced 80,142 vehicles in the third quarter, Tesla announced. That's a 50 percent increase from the prior quarter. It made 53,239 Model 3 vehicles, its lowest-priced model, in line with the 50,000 to 55,000 it had promised for the quarter.
Tesla produced 26,903 Model S and X vehicles, slightly better than its second-quarter performance and on track to reach deliver 100,000 Model S and X vehicles this year. The automaker delivered 83,500 vehicles in the third quarter, which is more than 80 percent of the vehicles that it delivered all of last year.
In a Sept. 30 email filed with the U.S. Securities and Exchange Commission on Monday, Tesla CEO Elon Musk said the electric car maker is nearing profitability.
"We are very close to achieving profitability and proving the naysayers wrong, but, to be certain, we must execute really well tomorrow (Sunday)," Musk's email said. "If we go all out tomorrow, we will achieve an epic victory beyond all expectations. Go Tesla!!!"
Tesla has racked up deep losses, announcing in August a record $717.5 million net loss for the previous quarter. It has never been profitable on an annual basis, and has turned quarterly profits only rarely. The company has been under mounting pressure to slow down its cash burn, with $1.3 billion of its more than $10 billion in debt coming due during the next six months.
Musk told analysts in August to expect Tesla's third quarter to be profitable, and the encouraging third-quarter production numbers may allow the company to reach that goal. Tesla isn't expected to release its third-quarter financial performance until early November.
But investors on Tuesday seemed to interpret the email to mean that profitability was not imminent, the Associated Press reported. Tesla's shares dipped 3.5 percent to $300 late Tuesday afternoon. Analysts are expecting Tesla to report a third-quarter loss of about $200 million, according to FactSet.
The company's stock price has swung sharply since Musk tweeted in August he was thinking of taking the company private.
The SEC sued Musk last week for securities fraud, saying the executive hadn't lined up funding for the deal, as he had claimed. Musk settled with the regulators on Saturday. He is staying on as CEO, but giving up his chairmanship.
The SEC had sought his removal as CEO as well. Musk and Tesla will each pay $20 million to resolve the case.
-- The Associated Press contributed reporting