Tesla made a pitiful number of Model 3 cars in Q3

Tesla shares drop 6% as Wall Street grows frustrated with production forecasts

While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public. Given that Tesla is doing some things for the first time in the auto industry, including the degree of automation in the manufacturing process, stumbling blocks are only to be expected.

Beyond the headline figures that included its biggest quarterly loss ever ($671 million), the focus was expectedly on what the bottlenecks were and how Tesla is working to overcome them. The firm had revenue of $2.99 billion for the quarter, compared to the consensus estimate of $2.94 billion. "At the rate Tesla is producing, the Model 3 may be my Christmas present to myself next year!" This indicates that production has not been as smooth as anticipated. The company delivered its 250,000th vehicle in the third quarter and expects to deliver 100,000 Model S and Model Xs in 2017, a 30% jump from the previous year. "Discussion of future cash flow was characteristically vague but the CFO emphasized that the eventual Model 3 ramp will be accompanied by substantial operating cash flow".

Model 3 production delays mean postponed sales and exacerbate the company's cash burn, made worse as Tesla pays to fix current manufacturing issues. The Reuters report was based on comments from Panasonic CEO Kazuhiro Tsuga, who said that bottleneck issues may be nearing an end.

"(1) What is happening to demand for the product? Some observers believe the Chevy model has been picking up customers who have begun writing off Tesla. As it is often wont to do, Tesla insourced the project and "significantly redesigned" that part of the module assembly line. But he also pointed a finger at the unnamed supplier of software used to operate the first of four zones along the line, insisting the "subcontractor (had) really dropped the ball".

Tesla is marketing the Model 3 for its affordability with a starting price of $35,000 United States dollars (£26,500). "The Model 3 is a ten-year program".

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Tesla said new features will be coming for its less-ambitious $5,000 Enhanced Autopilot package in the next few months. "Journalists and editors with low integrity failed to provide any context", Musk said, as quoted by Business Insider. That was a far bigger decline than Wall Street had predicted.

Musk seemed to confirm this news on the call but noted that any capital spending on a factory wouldn't come until 2019.

Tesla said the main constraint it now faced was within its battery module assembly line, where the company had to redesign part of the production process. But he did just that: first, with the Tesla Roadster sports vehicle, and then with the Model S sedan.

"If you talked to me three weeks ago, I would have been quite pessimistic", Musk admitted to investors Wednesday.

"If such production is not accompanied by an increase in cash consumption, we believe the stock will trade materially higher than it does today", Jonas said while cautioning that forecasting Tesla's ability to hit this goal is extremely hard.

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