Kevin Bullis

A View from Kevin Bullis

Tesla’s Explosive Revenue Suggests a Brighter Future

The maker of the Model S is cranking out cars and may be on track to turn a profit.

  • February 20, 2013

Last year Tesla Motors struggled to meet manufacturing targets for its only production car, the Model S, and it recently got hit with a negative review in the New York Times after a journalist ran out of power during a test drive (see “Tesla Blames New Delays on Production Difficulties” and “Musk-New York Times Debate Highlights Electric Cars’ Shortcomings”).

But things appear brighter now. Tesla announced today that its revenues have jumped by 500 percent and that it’s now making enough cars per week to deliver 20,000 of the vehicles by the end of this year. It also said it expects to make a small profit next quarter. Based on its gross margins, it seems that Tesla is now actually making its cars for less than it’s selling them for, rather than losing money on every one it makes, as had been the case previously. Improved productivity and lower costs for parts are helping. But when you factor in all of the company’s costs, including R&D and administration, the automaker still lost money—about $90 million.

Tesla says it now has 15,000 orders for the car, probably helped by receiving major awards and being featured on the cover of plenty of magazines. Who knows? The negative review and the dust-up that followed probably helped, too, if only to draw attention to the company. 

Cut off? Read unlimited articles today.

Become an Insider
Already an Insider? Log in.

Uh oh–you've read all of your free articles for this month.

Insider Premium
$179.95/yr US PRICE

More from Sustainable Energy

Can we sustainably provide food, water, and energy to a growing population during a climate crisis?

Want more award-winning journalism? Subscribe to Insider Premium.
  • Insider Premium {! insider.prices.premium !}*

    {! insider.display.menuOptionsLabel !}

    Our award winning magazine, unlimited access to our story archive, special discounts to MIT Technology Review Events, and exclusive content.

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

    Access to the magazine PDF archive—thousands of articles going back to 1899 at your fingertips

    Special discounts to select partner offerings

    Discount to MIT Technology Review events

    Ad-free web experience

    First Look: exclusive early access to important stories, before they’re available to anyone else

    Insider Conversations: listen in on in-depth calls between our editors and today’s thought leaders

/
You've read all of your free articles this month. This is your last free article this month. You've read of free articles this month. or  for unlimited online access.