Shares of Tesla Motor Inc. (NASDAQ: TSLA) slumped 6% in aftermarket trading on Wednesday after the electric car maker said that its fourth-quarter losses widened, citing higher manufacturing and sales expenses; however the Company highlighted that production of its key standard Model S, battery-powered Sedans was running at the rate of 20,000 units annually.
Wall Street analysts believe that the Company will have to hit production rate of 20,000 for its Model S sedans, annually, if it has to regain investors’ faith.
However, in the fourth quarter the Company missed its own target of rolling out 2,500-3,000 Model S cars as it could deliver only 2,400 units.
For the fourth quarter, the Palo Alto, California-based company reported a loss of $89.9 million or 79 cents a share, compared to a loss of $81.5 million or 78 cents a share, in the year earlier quarter.
Tesla’s Chief Executive, Elon Musk said that the Company will step up its cost cutting measures and expects it become barely profitable in the fiscal first quarter.
Musk said that Tesla’s immediate focus will be on slashing manufacturing costs, including cutting temporary staff at its factory, and sorting out parts related supply chain problems. The Company had to once airlift tires from the Czech Republic.
Musk also pointed out that the Company does not anticipate raising additional funds through sale of shares or debt contributions to finance the “couple hundred million” dollar costs of getting its Model X electric sport utility vehicle to production by 2014, according to the Wall Street Journal.
As an alternative, the Company is looking to fund the Model X electric sport utility vehicle through customer deposits and proceeds from what it expects will generate $2 billion in annual revenue, said Mush in an interview to WSJ.
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