Tesla Motors Inc Chief Executive Officer Elon Musk, in a push to show positive cash flow in the Q3, sent an email to Tesla’s employees encouraging them to slash costs and deliver all electric cars they possibly can. Musk – in his email – said that it would be his last chance to display better financial numbers before he attempts to raise more money, as per Bloomberg.
Q3 – extremely important for Tesla
For the future of the electric car maker, the Q3 is quite important because the automaker is preparing to deploy the Model 3 – its affordable sedan – next year, and it wants to acquire SolarCity – the clean energy giant.
In the email obtained by Bloomberg, Musk wrote that the automaker will be in a far better condition to convince potential investors, if the headline is “Tesla Defies All Expectations and Achieves Profitability” and not “Tesla Loses Money Again.” “That would be amazing!” he wrote. A spokesperson of Tesla verified the authenticity of the email sent by Musk, noted Bloomberg.
“I thought it was important to write you a note directly to let you know how critical this quarter is,” Musk wrote. “The third quarter will be our last chance to show investors that Tesla can be at least slightly positive cash flow and profitable before the Model 3 reaches full production.”
Have much to in Q4
Tesla Motors Inc is on the extreme edge of achieving a good Q3, but it requires making and delivering every car they possibly can, and at the same time, cutting any cost that is not important, for the upcoming 4.5 weeks at least. In 2015, the automaker delivered 50,568 cars, and said this year, it will deliver around 80,000 units. The U.S.-based firm has missed its first two quarterly sales targets, and has said to deliver around 50,000 vehicles in the second half of the year, but it has not given guidance for the Q3.
Musk concluded his email exclaiming that it would be pretty amazing to “throw a pie in the face of all naysayers on Wall Street who keep insisting that Tesla will always be a money loser!”
Separately, the shareholders at both – Tesla and SolarCity – could vote on the SolarCity acquisition as early as October, provided the Securities and Exchange Commission assents the merger. In the meantime, in preparation for the low-priced Tesla Model 3 – priced at $35,000 before incentives – the electric car maker is retooling its factory in Fremont, California.
Previously, Musk said Tesla Motors Inc is planning to raise more money this year. Musk said it will need to raise additional cash in the Q4 to complete the Model 3 car and the Gigafactory near Reno, Nevada that will manufacture battery cells.
On Friday, Tesla shares closed down 1.49% at $197.78. Year to date, the stock is down almost 17% while in the last one-year, it is down over 20%.