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Tesla's Q1 Loss and Ambitious Plans Drop Share Value by 5%

Tesla Motors announced some extraordinary objectives yesterday, but not everybody was impressed. The same day the company revealed its new targets, Tesla also posted its Q1 financial report and announced that two of its executives would leave.
Tesla Model S 1 photo
Photo: Tesla Motors
Skepticism about Tesla’s chances of success led to a five percent drop in share value, closing the day at $211.53, according to Automotive News.

Tesla’s new production target is seen as “too aggressive,” while its capital expenditures are larger than originally planned, says UBS analyst Colin Langan.

Some investors are afraid of companies that are too bold, and analysts feel the same, as these can ”set up investors for disappointment.

As some of you already know, Tesla has set the deadline for the Model 3 production start for July 1, 2017. And Elon Musk claims to use a sleeping bag at his office to ensure this gets done. If sleeping at work to eliminate lost time during commuting is not the definition of a workaholic, we don’t know what is.

Once Model 3 production begins, Elon Musk expects to build 200,000 units by the end of next year. In case the company fails to start the manufacturing process ahead of the deadline, the factory will have to work full-time to try to match Musk’s statements.

Unfortunately for Tesla, the company has a track record of delays in production, and their most recent launch was also involved in a few recall actions because of overcomplicated design, as those Falcon doors are not easy to make.

However, Elon Musk says the Model 3 will not be affected by the same issues as the Model X, as the new car has been designed with simplicity in mind. Instead of making its most affordable product an unsophisticated vehicle, Tesla Motors changed its views on the production process to develop an “easy-to-build” car.
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About the author: Sebastian Toma
Sebastian Toma profile photo

Sebastian's love for cars began at a young age. Little did he know that a career would emerge from this passion (and that it would not, sadly, involve being a professional racecar driver). In over fourteen years, he got behind the wheel of several hundred vehicles and in the offices of the most important car publications in his homeland.
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