Tesla’s narrower margin for error is just one more way in which it is different from its century old rivals. Tesla, most of whose cars are built to order directly, delivered 11,532 cars in the second period and said it had an operating loss of about $47 million, for an operating loss per car of about $4,000. To be sure, GM sells more than 9 million vehicles a year, while Tesla plans to build between 50,000 and 55,000 cars this year. GM, restructured six years ago in a government funded bankruptcy, has targeted cash reserves of $20 billion and had more than $28 billion in cash equivalents as of June 30. A typical new car can cost $1 billion or more to engineer and bring to market.Įstablished automakers such as General Motors Co and Ford Motor Co have amassed far larger cash cushions as they’ve rebuilt balance sheets battered by the 2008-2009 recession. Tesla had just $1.15 billion on hand as of June 30, down from $2.67 billion a year earlier.Īutomakers consume cash to pay for assembly line equipment, including metal dies and plastic molds, as well as testing to meet safety and emissions standards. Tesla’s shares fell almost 9 percent on Thursday and slipped another 2 percent on Friday as investors and analysts weighed the risks of Musk’s ambitious plans for expanding Tesla’s auto and energy storage businesses. Now he’s given himself a deadline, promising that by the first quarter of 2016 Tesla will be making enough money to fund a jump from making one expensive, low volume car to mass producing multiple models, and expanding a venture to manufacture electric power storage systems. Musk has taken investors on a thrill ride since taking Tesla public in 2010. Chief Executive Elon Musk said he’s considering options to raise more capital, and didn’t rule out selling more stock. The company on Wednesday cut its production targets for this year and next. The Silicon Valley automaker is losing more than $4,000 on every Model S electric sedan it sells, using its reckoning of operating losses, and it burned $359 million in cash last quarter in a bull market for luxury vehicles. New all-wheel-drive versions of the Tesla Model S car are lined up for test drives in Hawthorne, California October 9, 2014.
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