Tesla says Gigafactory costs may exceed expectations

Electric vehicle maker Tesla Motors Inc ended its turbulent second quarter with a larger-than-expected loss, but said it remains on track to increase production in the second half of this year and introduce a new auto next year.

The company came close to delivery projections, an area investors were closely watching after Tesla executives blamed “hubris” a quarter ago for badly missing their deliveries’ mark. Tesla’s plans seem aggressive, considering that mid-2017 is when the company wanted to begin production of the first mass-market auto, the Model 3.

In terms of vehicle deliveries, Tesla said 14,402 vehicles were delivered in the second quarter of 2016.

Tesla Motors Inc on Friday disclosed $1.1 billion in third quarter cash requirements in payments and planned expenditures, about a third of the cash on hand mid-year, in a new sign of pressure on the electric vehicle maker.

Tesla has missed its shipment guidance in the past, and that’s troubling news for a company that plans on making half a million cars in the 2018.

Revenue rose 33 percent to US$1.27 billion. The stock fell less than 1 percent in aftermarket trading to $225.60.

First Solar also offered guidance for the second quarter, saying revenue should be somewhere between $3.8 billion and $4 billion, as compared to analysts’ expectations of $3.86 billion.

The company also plans to add new stores in Taipei, Seoul, and Mexico City along with extra outlets in markets where it already has a presence, such as California. That’s more than double the loss analysts, on average, were expecting.

The company reiterated a recent statement that the backlog totaled 373,000 reservations, each of which requires a cash deposit of $1,000.

The company’s net loss widened to $293m, or $2.09 per share, in the second quarter, from $184.2m, or $1.45 per share, in 2015.

Tesla unveiled its massive battery factory, the Gigafactory, in Nevada last week, and on the conference call, Musk said he foresees “exponential growth” in Tesla’s storage battery business.

New vehicles orders rose by 67% compared to the same time a year ago. While the Model 3 is slated to be launched towards the end of 2017, the Model Y will only be released after that.

Despite Musk’s assurance that the company was now hitting on all cylinders, investors weren’t exactly bowled over.

The company will reveal a Tesla semi-truck and minibus within nine months, he said.