A report, released on Wednesday of this week by Tesla, announced a net loss of 49.8 million dollars in the first quarter. The announcement hasn’t come as a shock as the company as invested heavily in making their Model S viable for usage in the Asian and European Markets. The CEO, Elon Musk also explained on a conference call that Panasonic is likely expanding their involvement with the 11-year-old electric car company. Panasonic reportedly signed a “letter of intent” to be involved in the construction process of the so-called “Gigafactories,” that Tesla would like to build to keep up with demand for their vehicles.
Other important takeaways from the conference call by Musk include his announcement that the groundbreaking for one of those “Gigafactories,” is expected next month. He also noted that California is still in the running to host the site. The factories are expected to cost about 5 billion dollars to build. However, those factories may not be needed for the Model X as soon as initially predicted. The AWD dual-engine SUV, is going to be delayed until at least the second quarter of 2015.
Tesla is certainly not shying away from investing in their future. Construction is planned for at least one 5 billion-dollar factory. Reports from Musk have indicated that research and development could grow 30% from the first to second quarter. Tesla is spending at a rate that puts heavy pressure on their vehicles to sell, and factories to get correctly assemble the zero emission vehicles on time.
Time will tell the tale of whether or not Tesla will further stabilize their financial position and create a less expensive electric car for the masses, however, there is one thing to keep in mind. Tesla has been on the verge of financial collapse in the past, and somehow, someway, under the direction of Elon Musk, they have pulled thought.
Is Tesla the future of the auto industry, or will they eventually fade away?