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A tumultuous quarter at Tesla ended with very strong sales numbers.
The automaker delivered 83,500 vehicles in the third quarter, a solid performance that should ease investor concerns about logistics issues and a looming cash crunch. Of those vehicles, nearly 56,000 of the cheaper Model 3 were delivered.
Production was slightly lower than that figure: Tesla said it built about 53,000 Model 3s. But that figure was in line with the company’s projections.
Just three months ago, the company was struggling to produce 5,000 Model 3s in a week, a long-delayed goal. Tesla couldn’t keep up that pace, but production was still high enough to allow the company to turn a sustainable profit for the first time.
Tesla was in dire need of some good news.
In August, CEO Elon Musk proposed, then backed out of, taking the company private. The SEC filed a lawsuit against Musk last week, claiming he misled investors by claiming in a tweet that he had secured funding to take the company private.
On Saturday, the penultimate day of the quarter, Elon Musk reached an agreement with the SEC to pay a $20 million fine and step down as chairman of Tesla. He will remain CEO, news that relieved Wall Street on Monday.
Executives have also left the company in recent months, including the accounting director, who resigned after less than a month on the job.
Tesla (TSLA) stock closed down about 3% after the release of the production and sales report.
Tesla will release its revenue and profit figures later in the quarter. The report doesn’t provide details on how those figures will be released. It says all Model 3s sold at the end of the quarter were more expensive all-wheel-drive models powered by two electric motors.
Musk also sent an email to all Tesla employees over the weekend saying the company was close to its profitability target.
“We are very close to achieving profitability and proving the doubters wrong, but to be sure, we need to execute really well tomorrow (Sunday),” he wrote, referring to the last day of the quarter. “If we pull out all the stops tomorrow, we will have an epic victory beyond all expectations.”
The company has posted only two quarters of modest profits in its ten-year history. It has reported a total of $6 billion in losses during that period.
Tesla has $1.2 billion in debt coming due in the next six months, prompting some analysts to predict the company would need to sell additional stock or debt to raise cash.
Elon Musk said the sales revenue would give Tesla the cash it needs. But he also admitted the company has had problems delivering its cars. That has heightened investor concerns about a cash crunch.
“Sorry, we’ve gone from production hell to delivery logistics hell,” Musk tweeted two weeks ago to a customer who asked when a promised car would be delivered. “This problem is much easier to solve,” he added. “We’re moving quickly.”
Cnn
