Elon Musk backs off Tesla's goal of making 1 million vehicles by 2020

Joshua Lott/Getty ImagesElon Musk

  • Tesla‘s CEO, Elon Musk, and CTO, JB Straubel, suggested the company may not hit its goal of making 1 million vehicles by 2020 during its second-quarter earnings call on Wednesday.
  • After Wall Street Journal reporter Tim Higgins asked if the company still planned to make 1 million vehicles in 2020, Musk and Straubel said that was their goal, but suggested the actual number may be lower.
  • “I think we have a shot at a million but somewhere 700,000, 800,000 seems pretty likely given … what we know today,” Straubel said.
  • During Tesla‘s first-quarter earnings call in 2017, Musk said it was “quite likely” the company would make 1 million vehicles “or maybe more” in 2020.

Tesla’s CEO, Elon Musk, and CTO, JB Straubel, suggested the company may not hit its goal of making 1 million vehicles by 2020 during its second-quarter earnings call on Wednesday.

After Wall Street Journal reporter Tim Higgins asked if the company still planned to make 1 million vehicles in 2020, Musk and Straubel said that was their goal, but suggested the actual number may be lower.

“I think so, yeah,” Musk replied. “If it’s not a million, it’s going to be pretty close. I’d say if it’s not a million it’d probably be 750,000 or something like that in 2020. So, we’re aiming for a million, 2020, but somewhere between half million and a million seems pretty likely.”

Straubel expressed less certainty about Musk’s previously-stated 2020 production target.

“I think we have a shot at a million but somewhere 700,000, 800,000 seems pretty likely given … what we know today,” he said.

During Tesla’s first-quarter earnings call in 2017, Musk said it was “quite likely” Tesla would make 1 million vehicles “or maybe more” in 2020.

The company has a history of revising ambitious production timelines. In 2016, the company said it would make 500,000 vehicles in 2018, but made 87,833 vehicles in the first half of this year. Tesla hasn’t said it will be able to achieve a production rate in the second half of 2018 that would allow it to approach 500,000 total vehicles by the end of the year.

Tesla said on Wednesday that it made 7,000 total vehicles in a week multiple times in July after struggling to ramp up Model 3 production. Achieving a consistent production rate of 7,000 vehicles per week is critical to the company’s goal of becoming profitable.

Tesla reported an adjusted loss per share of $US3.06 for the second quarter, which was larger than what analysts had predicted, and revenue of $US4 billion, which beat analyst projections. The company said it expects to be profitable during the second half of 2018.

“Going forward, we believe Tesla can achieve sustained quarterly profits, absent a severe force majeure or economic downturn, while continuing to grow at a rapid pace,”the company said.


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