Tesla, the Elon Musk carmaker that wants to become the first large-scale manufacturer of cheap (relatively cheap, at least) electric cars with the Model 3 car, continues to miss its production targets, generating doubts and concerns about the future of 'agency. There are currently tens of thousands of people who have pre-ordered a Model 3, which is expected to start at $ 35,000. But Tesla is producing far fewer than expected, and has already postponed reaching its production and delivery targets several times.
At one point on Wednesday, March 28, due to a downgrade of the company's rating by Moody's, Tesla lost 8% of its stock market value. To complicate matters, the company announced Thursday that it plans to retire 123,000 Model S cars produced before April 2016 due to a power steering problem. Tesla will notify affected owners when a repair service is available in their area, which will fix the problem within one hour.
Bloomberg has built a continuously updated counter on how many Model 3s Tesla has produced so far and how many it is producing weekly. Putting together the data available to the US government, official communications from Tesla and sources in the company, he estimated that 11,418 Model 3s have been produced so far, and that weekly production is 1,058 units. These figures fall far short of Elon Musk's company targets. Since last July, when the Model 3 was introduced to market, Tesla has continued to postpone the goal of 5,000 units produced per week. At the end of each quarter he said that production was increasing and that he expected to reach the target in the next three months. Theoretically, according to the announcements of the same company, by the quarter ending tomorrow Tesla should have produced 2,500 units a week, but it is stuck at less than half. In January, it also predicted that it would hit 5,000 units per week by the end of the next quarter, which is the end of June, but today it seems unlikely.
Musk's plan for Tesla is very ambitious, and a little for his charisma, a little for his ability to inspire people with visionary projects, a little for the many things he has already accomplished and continues to accomplish in the many sectors in which it is active – whether they are reusable rockets or battery-powered power plants – has garnered a lot of trust and enthusiasm among investors and common enthusiasts. In 2010, Tesla became the first US automaker to go public in 54 years. Today it has a volume of business such as to play in the same league as the most important and historic American car manufacturers: its shares are worth a total of about 43 billion dollars, against 43.8 of Ford, which however is a company that sells millions of car every year. Its models are sold at prices similar to those of luxury car manufacturers, such as BMW and Porsche.
But the survival and sustainability of the project behind Tesla will increasingly depend on its ability to produce and sell far more cars than it produces today. At one point last year, there were 500,000 people on the waiting list to buy a Model 3, each of whom paid a $ 1,000 advance, but it's not clear how many pulled back and got a refund.
Moreover, by November, Tesla will have to pay 230 million dollars in bonds, and another 920 million will have to pay by the following March. Tesla has never made a profit since its existence, and in 2017 it lost $ 2.24 billion, up from $ 773 million in 2016. In the last three months of 2017 alone, it lost $ 675.4 million, up from $ 121 million. for the same period of 2016. At the end of last year, Tesla had approximately $ 2.4 billion in supplier debt. However, these are not in themselves dramatic or too worrying figures, but if the company continues to miss its objectives it could begin to have problems with creditors.
On his own, Musk said he will work for free, with no compensation or bonus of any kind, for the next ten years: at that point, if Tesla achieves a market cap of $ 650 billion as per goals, he will get a bonus of $ 650 billion. 55.8 billion dollars, which would make him the richest man on the planet.
After downgrading Moody's, Standard & Poor's said it could make a similar decision as well. These problems coincided with the opening of a federal investigation into an accident last week at a Tesla Model X near Mountain View, California, which resulted in the car's driver's death. It is unclear if he was using the autopilot system.
