As Tesla Hits 7,000 Production in a Week, Skeptics Retreat

© Ewais / Shutterstock.com

By Douglas A. McIntyre, 24/7 Wall St.


Tesla Inc. CEO Elon Musk said the company would reach production of 5,000 Model 3 vehicles per week. A new tweet says he did better, but it included all Tesla models:

https://twitter.com/elonmusk/status/1013519243030253570

Of these, the company indicated, 5,000 were Model 3 versions.

24/7 Wall St. examined the chances yesterday:
[post_ads_2]
In a week or two, Tesla Inc. founder and CEO Elon Musk will say whether his company has been able to make 5,000 of its new inexpensive Model 3 vehicles a week. It will tell whether the company can produce cars fast enough to catch up to demand, which may be as high as 400,000, and push toward the profit it has not been able to reach after years of operation. But what is the real threshold for investors? What if the number is slightly above or below the 5,000?

The 5,000 number is a magic one, at least as far as the media has reported and many analysts have said. As recently as two months ago, Tesla’s Model 3production was not even close. Tesla has opened more factory capacity, and Musk currently sleeps on the floor next to one production line, presumably to spur on his workers. Or perhaps he is actually helping assemble cars.

If the weekly production number is, say, 5,100, Tesla’s stock should shoot up. Musk will have proven that his complex factory infrastructure has been turned into a mass production facility. Problems with parts suppliers, rumored factory fires and stories of angry workers will fade. Tesla claims that 400,000 people have made deposits on the Model 3. Tesla can start to eat through that demand. At a price of $35,000 each, strong production will sharply lift Tesla’s revenue. Analyses that Tesla will need to raise money and dilute shareholders also will fade.
[post_ads_2]
However, there is some weekly production number below which investors will panic, and pessimistic investors and analysts will gloat. The short interest in Tesla shares is among the highest of stocks traded on the Nasdaq. At just over 37 million, the shares sold short are 30% of the float, which means the bets that Tesla’s share price will fall are substantial.

Musk will need to make an unusually convincing argument that any number below 5,000 a week is acceptable. Many investors and much of the media already believe he is sort of a shady used car salesman and this will make it hard. A figure of 4,999 may be too low.

COMMENTS





Name

Accessories,1,Auto Insurance,1,Auto Show,13,Autos,411,Autos News,5,Barn Finds,1,Buying,1,Car Shows,1,Car Tech,1,Certified Pre-Owned Vehicles,1,Chicago Auto Show,1,Classic Cars,11,Consumer Electronics Show,1,Customs & Classics,1,Detroit Auto Show,1,Driving,1,Enthusiasts,27,Frankfurt Motor Show,1,Fuel Economy,1,Gearheads,1,Geneva Motor Show,1,Hot Rod Power Tour,1,Imports,1,Just For Fun,2,Los Angeles Auto Show,1,Maintenance,1,Motorcycles,17,Motorsports,1,Muscle Cars,1,Muscle Cars & Hot Rods,1,New Bikes,1,New Car Deals,1,New York Auto Show,1,News,47,Ownership,10,Paris Motor Show,1,Pebble Beach Concours d'Elegance,1,Recalls,1,Research,9,Reviews,1,SEMA Show,1,Shanghai Auto Show,1,Sports and Exotics,1,Sports Cars,1,Supercars,1,Tech,1,Tokyo Motor Show,1,Trucks,1,
ltr
item
Autos - U.S. Daily News: As Tesla Hits 7,000 Production in a Week, Skeptics Retreat
As Tesla Hits 7,000 Production in a Week, Skeptics Retreat
https://4.bp.blogspot.com/-eyD_buR2WAI/WzpeWewJHHI/AAAAAAAATxA/vGN-YQKo2zsye_QDtbLZD3QTOOwqwNSEwCLcBGAs/s1600/1.jpg
https://4.bp.blogspot.com/-eyD_buR2WAI/WzpeWewJHHI/AAAAAAAATxA/vGN-YQKo2zsye_QDtbLZD3QTOOwqwNSEwCLcBGAs/s72-c/1.jpg
Autos - U.S. Daily News
https://autos.dailynews.us.com/2018/07/as-tesla-hits-7000-production-in-week.html
https://autos.dailynews.us.com/
https://autos.dailynews.us.com/
https://autos.dailynews.us.com/2018/07/as-tesla-hits-7000-production-in-week.html
true
7329154058020919259
UTF-8
Loaded All Posts Not found any posts VIEW ALL Read More Reply Cancel reply Delete By Home PAGES POSTS View All RECOMMENDED FOR YOU LABEL ARCHIVE SEARCH ALL POSTS Not found any post match with your request Back Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS PREMIUM CONTENT IS LOCKED STEP 1: Share. STEP 2: Click the link you shared to unlock Copy All Code Select All Code All codes were copied to your clipboard Can not copy the codes / texts, please press [CTRL]+[C] (or CMD+C with Mac) to copy