A View from Kevin Bullis
Tesla Still Losing Money, But Plans an Early Debut for Its Sedan
The automaker plans to ship its Model S electric sedan in June, rather than July.
Tesla Motors announced today that it is on track to start delivering its Model S in June, a month ahead of schedule. It moved up the date of the first deliveries because it’s nearly completed testing on 80 cars it’s built so far.
Tesla continues to lose money. It lost nearly $90 million in the first quarter of 2012, compared to a loss of about $50 million during the same period the year before. It’s staying afloat in large part thanks to a Department of Energy loan. It continues to meet the milestones required by the loan, so it still has access to the money, unlike Fisker Automotive, another small automaker selling electric vehicles, which recently fell behind on its DOE milestones and lost access to its loan funds.
Tesla expects a large shot of revenue in the second half of the year, once it starts shipping the Model S. Of the $560 to $600 million it expect to bring in during 2012, 90 percent will come after June. It plans to deliver 5,000 cars this year, and it already has 10,000 reservations for the car.
The expected revenue jump won’t necessarily make the company profitable though (see “Will Tesla Survive?”). That could depend on whether the cost of making the car is low enough for it to break even, something that seems unlikely given that it is a completely new vehicle.