Tesla Motors chief executive Elon Musk delivered a teaser for the electric-car maker’s second-quarter earnings this week, divulging that Model S output had surged past its initial weekly goal.
That target was to build 400 sedans a week. The pace of manufacturing has already exceeded that – “and not trivially,” Musk said Wednesday. He also said he expected production to hit 800 cars per week by late next year, adding, “I’m very confident we’ll get there.”
Tesla has been riding high lately. On Monday, the company will join the Nasdaq 100 Index. The Palo Alto, Calif. automaker’s market cap, as of Thursday, was just over $14.4 billion. The stock itself has been hovering between $122 and $125.
In June, the luxury electric-car maker reported 8,931 sales for the first half of the year, leaving it a bit shy of its goal of delivering 21,000 cars by year’s end. Musk had raised the goal, from 20,000, in a statement posted on the company website in May.
Joe Langley, principal analyst for IHS Automotive, said these recent vague-but-promising production numbers might put Tesla back on track. “What I thought was interesting was that (Musk) said it was materially above 400 cars a week, not just a minor thing,” Langley said.
A Tesla spokeswoman said the date for the second-quarter earnings report had not yet been set, but should come sometime in the next few weeks.
Tesla’s recent prosperity could be merely the result of carmaker meeting pre-existing demand. “The $64,000 question is, ‘Can (deliveries) stay at that volume once the initial batch of orders is fulfilled?’ ” Langley said.
The high-end electric vehicle – the Model S sedan starts at $62,400 after a $7,500 rebate – has built up a loyal following of drivers who, Langley said, seem to “believe in the car’s mission” as much as early Prius adopters did in their unconventional hybrids. “Any automaker would kill to have customers that ingrained in it,” Langley said.
The challenge lies in converting drivers from the sidelines. While EVs have struggled to gain traction among the majority of consumers, Tesla might be in the best position to launch the electric revolution into the high gear advocates want.
“This is where the mainstream manufacturers haven’t been as successful with electric cars,” Langley said. “Tesla, from the ground up, is an electric vehicle. It’s better packaged, and it has this greater mission to create EVs, to have the world switch to EVs. I’ve seen people (for whom) this is the most expensive car they’ve ever owned by a long shot. They’re stretching because they believe in the mission that much.”