Tesla stocks up, despite missing revenues target
While the price of crude oil has been steadily rising over the past year, bring the price of gasoline for cars up with it, Tesla may be making that irrelevant as orders for its electric cars are on the rise.
While Tesla’s quarterly report reflected a disappointing loss of $0.69 per share rather than the estimated $0.42, Tesla stocks rose to $277.90 in after-hours trading on Wednesday, after closing the day down 1.4% at $273.51.
The surge may be the result of a combination of factors. First, the company revealed in a letter to its shareholders that it has expects to deliver as many as 50,000 of its Model S and Model X vehicles in the first half of 2017. This number represents a record number of orders that the company has received for its sedans and SUVs. Second, Tesla announced yesterday that its new, and lower-priced Model 3 is set for volume production by September of this year.
The Model 3 will sell for approximately $35,000, which Tesla executives will give the company a good foothold in the automotive market. The Model S retail price starts at $68,000 and the Model X SUV starts at $85,500. The Model 3 will enable far more consumers to jump into the promising market of electric cars.
Tesla plans to begin producing the Model 3 Sedan in July, and by “some point in the fourth quarter” produce more than 5,000 Model 3s per week, and 10,000 per week by some time next year.
Tesla CEO, Elon Musk spoke to analysts yesterday in a conference call, saying that at this stage “no capital needs to be raised for the Model 3 but we get very close to the edge.” Musk said that Tesla currently has on hand $3.4 billion and plans to raise as much as $2.5 billion more. He said that it “makes sense to raise capital to reduce risk.”
In the last year, Tesla’s stocks have skyrocketed by more than 55%, and many analysts are confident that the company is set to only grow stronger. According to Musk, Tesla plans to deliver 500,000 vehicles in 2018, and double that number by 2020.