Tesla Motors shares speed up as electric car demand grows
Closely followed US electric car maker and battery producer Tesla (NASDAQ:TSLA) saw shares surge over 10% on Wednesday as traders hailed the group’s third quarter numbers, which showed demand for its products was growing.
Despite a one week shut down in production, the group, headed up by Elon Musk, made a record 13,091 vehicles in the three months and delivered a 11,603 new vehicles – ahead of expectations and also a new record.
Key to the firm keeping up with demand was relocating to a new huge Gigafactory in the Nevada desert, which was achieved post the three month end, but the roll-out there is ahead of schedule.
Tesla said in the fourth quarter it planned to build between 15,000 and 17,000 vehicles, and deliver 17,000 to 19,000 vehicles, which will result in total deliveries of between 50,000 and 52,000 for the year.
In China, the firm’s newest major market, uptake of the firm’s products has been strong.
In the third quarter, orders increased by more than 50% for its Model S car compared to a year ago and grew at a faster pace in North America, Europe and Asia, than in the second quarter, and in China, Model S orders increased substantially from Q2, the firm said.
“We expect order growth in China to remain strong with more store openings and the recent policy changes in Beijing and other major cities that allow buyers of Tesla vehicles to bypass license plate restrictions,” it told investors.
In September this year, Tesla launched the third vehicle, the Model X, a sport utility vehicle (SUV), which can seats seven adults and tow up to 5,000 lbs.
The company also said it was seeing “very strong demand” for its Energy products, particularly in Australia, Germany and South Africa.
“There is also an exciting market opportunity for us in India with strong government alignment that we look forward to growing in 2016. Recent changes to feed-in tariff structures in Hawaii also create a large new storage market in that state,” said chief executive Elon Musk in a letter to shareholders.
The group added it had accelerated plans to begin cell production for Tesla Energy products at the Gigafactory by the end of 2016 – several quarters ahead of its initial plan.
Revenue for the quarter was US$1.2 billion – up nearly 33% from a year ago, but slightly below expectations.
The net loss was US$230 million, unsurprising for a company at this formative stage.
Musk said he planned to invest about US$500 million in the fourth quarter, which will bring the projected total capital expenditures for this year to about US$1.7bn – mainly due to accelerated investments in the Gigafactory, further integration of manufacturing activity, and faster milestone execution by certain suppliers for Model X manufacturing equipment and tooling.
Shares gained 10.45% to stahd at US$230.13 each.