Tesla posts £487 million Q4 loss but predicts profit in 2018

SpaceX  YouTube

SpaceX YouTube

Musk said during the company's fourth-quarter earnings call on Wednesday that Tesla became "too confident" in its ability to make batteries, which contributed to its current production problems.

Tesla said it is on track to meet its goal of producing 5,000 Model 3 cars a week by the end of the second quarter, executives said Wednesday. But free cash flow will likely remain negative in the first quarter as the company estimates a negative Model 3 gross margin during the period.

The day after Tesla and SpaceX CEO Elon Musk blasted his Tesla Roadster into space, his electric vehicle company's mounting losses brought him back to Earth again.

Tesla lost US$1.96 billion for the full year, a record for the company and almost three times its loss of US$675 million in 2016.

While Tesla's true believers love these stunts, some analysts are questioning whether Musk should be spending more time fixing Tesla's woes.


Originally, the manufacturer planned to build 10,000 Model 3 units in December previous year but in reality, Tesla only managed 1550 deliveries.

"It's ironic since battery modules should be the thing we are best at", Musk told analysts. The Palo Alto, California-based automaker is struggling to meet production targets for its first mass-market auto, the Model 3 sedan.

While responses to the Model 3 have been generally positive so far, Tesla has experienced significant production delays with the vehicle and has over 400,000 pre-orders to fulfill.

"If we can send a Roadster to the asteroid belt, we can probably solve Model 3 production". Capital expenditures in 2017 were $3.4 billion - up from $1.3 billion in 2016. The company expects sales of energy storage products to triple in sales and gross margins to improve in 2018.

The report said Tesla delivered a combined 28,425 Model S and Model X vehicles during the fourth quarter of 2017, 10% more than the company's previous record, which was set in the third quarter of 2017.

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