Tesla Loses $50 Million, But Builds Record 7,535 Vehicles



Tesla Motors released its always-anticipated quarterly report today, and the news was a decidedly mixed bag this time around. In positive news, Tesla built a record number of Model S sedans in the first three months of 2014, but also lost $50 million in the first quarter of 2014. In fact, the electric automaker doesn’t expect to make a dime this year as it goes through growing pains that could also delay the Model X.

Using Generally Accepted Accounting Practices, or GAAP, Tesla lost $50 million last quarter, reporting earnings of 12-cents per share. But even though Tesla beat many analysts’ forecasts, Tesla stock still took a hit, and that probably has more to do with the again-delayed Model X. Elon Musk is now saying that the first Model X SUVs may not roll off the assembly line until the second-quarter of 2015, meaning full-scale production might not ramp up until well into 2016. For the 12,000 or so people who have plunked down at least a $5,000 deposit, this delay is certainly unwelcome, but necessary to deliver a polished product.

But contrary to reports suggesting demand for the Model S was slowing in America, Tesla reported a 10% increase in domestic demand of the sedan. Elon also remains remarkably bullish on China, remarking that there is already a four or five month wait in many cities for the Model S, and the first steps towards establishing a national Supercharger network are already underway.

Less exciting but just as important is the installation of a newer and more automated production line that will help increase output of both the Model S and Model X. Though this will shut down the Fremont factory for 10 days, it will no doubt pay for itself, especially since Musk plans to break ground on one of two Gigafactory sites within the next month. He wants to get the Gigafactory going, and soon, because Tesla’s going to need every battery it can build.

Alas, all these setbacks and investments cost money, and Tesla told investors it doesn’t predict it will make a profit this year. That’s to be expected for a growing automaker, but I’m starting to wonder what the hold up with the Model X is all about. How about you?

Source: Tesla Motors via Autoblog Green

About the Author

A writer and gearhead who loves all things automotive, from hybrids to HEMIs, can be found wrenching or writing- or else, he’s running, because he’s one of those crazy people who gets enjoyment from running insane distances.

  • Bi-Polar Bear

    Hmmm…..How can you buy apples for 25 cents apiece, sell them 5 for a dollar and expect to make a profit? You can’t make up the difference by selling in volume. Everyone and his brother is falling all over themselves to praise Elon Musk for his brilliance. But heck, I could lose $50,000,000 in 3 months, no problem. It’s all fine as long as Uncle Sugar is handing out interest free loans, grants and tax breaks and paying buyers $7500 each to buy one of my products.

    Call me crazy, but I think Musk may just be the Bernie Madoff of the car business. Or maybe I’m just grumpy this morning.

    • Jim Smith

      when you are building a car company from the ground up, it costs money. How much money did Google make in its first couple of years? How about Facebook?

      Tesla repaid taxpayers, with interest, nine years early. The track record of the DoE loans is head and shoulders above the “private” finance market, not to mention, is affordable to new businesses.

      Tax credits are employed in most new industries as the “free” market does not work. If the “free” market worked for new, cutting edge, high risk technologies, there would not be such a thing.

      • Bi-Polar Bear

        Everything you say is true. Especially that the “free market” doesn’t work. Of course, that is heresy in political circles, where terms like “free market”, “free enterprise”, “free trade” and “capitalism” are bandied about as if they were enshrined in the tablets Moses brought down the mountain after his meeting with God!

        I guess what sticks in my craw is that AFTER the taxpayers pony up to get one of these start ups off the ground, the owner(s) then crow about how they built the business themselves without any help from the government, unlike the lazy slugs who are out of work because they don’t really want to work, they want to stay home and watch Duck Dynasty re-runs while waiting for the welfare check to arrive. See “Mitt Romney” for more on this subject.

        So how did Musk GET all that government assistance in the first place? I still think he is a glad handing huckster who has snowed a bunch of supposedly bright people with his pie in the sky predictions. I personally was devastated by the tech crash of 2000-2001, when a bunch of companies with high market cap but no discernible income went up in flames. As the song goes, “We won’t get fooled again.”

        If you are a Tesla shareholder, all I can say is, “Good luck!”

        • Jim Smith

          Not sure if any of mutual funds hold Tesla..i don’t directly own any. DoE loan process is about as transparent as possible so not sure what you are questioning. Time will tell. The zero maintenance electric cars are going to destroy ICE long term. Thus you have a lot of vested interests spewing propaganda nonstop to defend their turf.

          • Bi-Polar Bear

            Thus you have a lot of vested interests spewing propaganda nonstop to defend their turf.

            Gotta agree with that!

          • Jim Smith

            right, that is why i posted a pro-tesla puff piece which you replied to…oh wait, you posted an anti-tesla piece which i replied to pointing out what i disagree with.