Tesla Inc. announced further delays this week on the new Model 3 sedan. The delay is now at three months and the company said there were solid developments when around fixing the bottleneck in production, however it’s been hard to predict when all issues would be rectified.
In further bad news for Tesla, it reported its largest-ever quarterly loss, plummeting shares by close to five percent.
Autoblog reported that Tesla’s CEO Elon Musk expects the 5,000 Model 3s to be built weekly by the end of the first quarter in 2018. The date originally for this was December of this year. It seems the main issue in production is the battery module assembly, as Tesla had to redesign the process around production for that area.
And Tesla’s long-term sustainability is now dependent on the new Model 3 sedan, which will cost about $35,000; half the price tag of the company’s Model S. The automaker has plans to produce 500,000 cars come 2018, a majority of those being Model 3s, which is an increase of six-fold when it comes to 2016 levels; it made a mere 260 units of this new sedan in the third quarter of this year, due to the production bottlenecks listed above.
At the end of the day, delays in production mean delays in sales; not to mention having about 500,000 uneasy clients who have already put down (refundable) deposits and are waiting for their new vehicles.
On top of that, the company announced a net loss of over $619 million in the third quarter, versus the over $21 million profit announced at the same time last year. Revenue increase by 30% to well over $2 billion. The company also stated that as of September 30th, it had $3.53 billion in cash/cash-equivalents, versus the $3.04 billion it had last year at around this same time.
It has been reported that last month Tesla delivered 26,150 cars in the third quarter, a 4.5% increase when compared to the same time last year. Unfortunately, the Model 3’s production issues have left the company staggering a bit and has taken some momentum from the new sedan’s release.