Last night, Tesla Motors released its quarterly reports for the last quarter of 2014, reporting that it built a record 11,627 vehicles but also lost about $108 million for the quarter. Yet despite Chinese sales being far below expectations, and not delivering quite as many vehicles as hoped, Musk still expects Tesla to sell 55,000 Model S and X vehicles in 2015.
Of the 11,627 Model S sedans Tesla built, it delivered 9,834 cars, blaming bad weather, customer vacations, and shipping problems on the slow pace of deliveries. Despite this though, Musk says Tesla has some 10,000 orders for the Model S currently, and another 20,000 Model X reservations, which alone makes up more than half of the automaker’s 2015 production goals. The Tesla CEO even went on to say that he was confident he could sell 50,000 vehicles even without a single sale in China. Tesla brought in total revenue of $956 million in 2014, of which just $86 million came from selling regulatory credits. For the year, Tesla lost about $296 million, most of that from one-time charges like expanding production capabilities.
So what about the Model X? According to Musk, there are already some 30 “Beta” versions of the Model X undergoing extensive testing, though there are features the public doesn’t yet know about coming on the electric SUV. Musk also said that an upgrade for the Model S battery pack is still probably some 5 years out. Tesla is starting off 2015 with about $1.9 billion of cash in the bank.
Here’s what I am gleaned from the report. Demand for Tesla products is still strong, but as many have speculated, Musk and his company are coming to realize just how difficult car design can be, and we might have to scale back our expectations for the Model III. Musk briefly mentioned the Model III, saying it won’t be very “adventurous” at first as the company aims to meet its self-imposed 2017 deadline. So don’t expect a car-defining feature like the falcon-wing doors, at least at first, though there’s always room down the road for the addition of new features or models…say like, a wagon?
While Tesla fell short of Wall Street expectations, demand and revenue seems plenty strong for the upstart automaker, and Musk came mighty close to meeting most of his benchmarks. Things don’t get any easier from here, but Tesla’s success thus far has already defied the odds.