Tesla offered assurances Wednesday that the launch of its first mass-market electric car, the Model 3, remains on track as it issued fourth-quarter results that cut its losses and beat revenue estimates.
The electric car maker is under intense scrutiny as it transitions its focus from its two current vehicles, the luxury Model S sedan and Model X crossover, to its high-production model. It said in its earnings release that Model 3 is “on track” with limited production due to start in July.
It plans to keep ramping up Model 3 production until it hits 5,000 cars a week in the fourth quarter and 10,000 vehicles a week in 2018. Tesla has taken more than 400,000 reservations for what could be a breakthrough car when it comes to electrification of the automotive industry. it will be expensive to start Model 3 production, with Tesla saying it will invest $2 billion to $2.5 billion to ramp up its factory.
All the while, Tesla will need to keep up excitement about its two luxury models, which will continue to be big profit contributors.
Tesla said it intends to deliver 47,000 to 50,000 Model S sedans and Model X crossovers for the first half of the year. Those numbers represent growth of at least 61% compared to the same period last year.
As for earnings, Tesla narrowed its losses in the fourth quarter and came in ahead of expectations.
Tesla said it lost $121.3 million, or 78 cents a share, compared to $320.4 million, or $2.44 a share, last year on an unadjusted basis.
Adjusted, Tesla lost $106.5 million, or 69 cents a gallon, compared to $264.8 million, or 75 cents a share, in the same quarter last year. That was a big improvement over the $1.18 a share loss that a consensus of analysts had expected, Bloomberg News reported.
Revenue of $2.18 billion was slightly ahead of analysts’ estimates.
Contributing: Adam Shell
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