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Tesla will make about 500k cars this year : Musk

Bloomberg Singapore | Updated on February 20, 2019 Published on February 20, 2019

Elon Musk, Founder, Tesla Inc   -  Reuters

To expand its business in China, Tesla is building a plant in Shanghai and is looking to start production there late this year

Elon Musk said Tesla Inc will make about 500,000 cars this year.

In a letter to shareholders, Musk and his chief financial officer (CFO) forecast as many as 400,000 total vehicle deliveries this year. But within hours, Tesla’s Chief Executive Officer (CEO) told an analyst to expect sales for the Model 3 to reach as many as 500,000 units in 2019.

To Musk’s credit, Tesla made substantial progress in mass-manufacturing electric vehicles last year, after overcoming the production hell he predicted the company would go through starting in the fall of 2017. The total deliveries had more than tripled last year.

Still, making 500,000 vehicles in 2019 will be difficult based on the projection Musk. CFO Deepak Ahuja stated late last month that Tesla may need until the end of this year to reach a weekly production rate of 7,000 Model 3s.

Tesla produced roughly 101,500 Model S sedans and Model X crossovers last year, and has dialled back output of those models in early 2019. Musk and Ahuja said the expiration of the full federal tax credit in the United States (US) at the end of December probably pulled ahead some demand and cautioned deliveries will be lower in the first quarter.

To expand its business in China, Tesla is building a plant in Shanghai and is looking to start production there late this year.

The electric-vehicle maker kicked off this year on a dull note, with fourth-quarter deliveries slightly lagging expectations. Multiple price cuts have followed for the Model 3 sedan to compensate for the gradual elimination of government incentives in the US. Tesla’s quarterly profit, reported in late January, also missed estimates.

Published on February 20, 2019
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