Tesla Inc. shares dropped in premarket trading Thursday after the automaker stated that its anticipated Tesla Model 3 car won’t meet current estimates.
The electric car maker released on Wednesday delivery numbers for the fourth quarter of 2017 that fell short of many trader expectations. Tesla Inc. also announced that it will push back production estimates for its Tesla Model 3 car later in 2018. The current target is of 5 thousand units by the end of June with the company blaming the slow output on „production bottleneck”.
According to the company, they were able to produce 2,425 Model 3 Sedans and delivered 1,550 to customers at a list price of $35 thousand. All this is said to have occurred from October to December. The number of units fell way short than the previous estimate of 4,100 during that time frame.
„… we expect to have a slightly more gradual ramp through Q1, likely ending the quarter at a weekly rate of about 2,500 Model 3 vehicles,” Tesla Inc said.
While the Palo Alto-based company thanked the Model 3 customers for sticking with them, the overall popular sentiment slashed Tesla shares 3.1 percent in pre-market trading in New York.
The reason behind these smaller production rates seems to be because of a series of manufacturing problems at the Tesla battery plant in Nevada. In addition, Tesla Inc.s Fremont factory in California has been reported to have slower than expected welding and final assembly of the Model 3’s. Tesla CEO, Elon Musk, said back in October that the Model 3 had put the company into „deep production hell” as they transitioned from niche to mass manufacturer of electric cars.
According to Tesla Inc., they were able to stabilize production and have so far reached 1 thousand units per week. Based on this recent breakthrough, the company has set a new goal of rolling out 2.500 Model 3’s each week by the end of the first quarter. By the end of Q2 that would double to 5 thousand per week.
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