Today Tesla Motors released quarterly results for Q2 2014, said they’re on track to exceed the goal of 35,000 Model S sales during 2014, verified that they’d broken ground on a potential Gigafactory location in Reno Nevada, and several other things. Let’s take a look.
To start with the news from Reno, last week we reported a rumor that the Taho-Reno Industrial Center was going to be the site of the Tesla Gigafactory. That hope was dashed the next day when it was learned work had stopped on the site in question. But the shareholders letter confirmed the Reno location is a potential Gigafactory site, and did not confirm any site selection had been finished.
In June, we broke ground just outside Reno, Nevada on a site that could potentially be the location for the Gigafactory. Consistent with our strategy to identify and break ground on multiple sites, we continue to evaluate other locations in Arizona, California, New Mexico and Texas. The final site for the first Gigafactory will be determined in the next few months, once we have full visibility and agreement on the relevant incentives and processes for enabling the Gigafactory to be fully operational to meet the timing for Model 3. We see these concurrent efforts as prudent. This vehicle will be our third-generation product and will substantially broaden the addressable market for Tesla, helping to accelerate the transition towards sustainable transportation. Any potentially duplicative investments are minor compared to the revenue that could be lost if the launch of Model 3 were affected by any delays at our primary Gigafactory site.
While it’s nice to receive validation for going out on a limb to report a rumor, it doesn’t tell us the final confirmation.
The Fremont factory is now running at 800 Model S’s produced per week, and they produced 8,763 Model S’s during Q2. That’s up 16% from Q1, and is the result of production efficiencies and increasing demand. Customer deliveries were 7,579 in Q2 – worldwide (North America, Europe, Asia).
Panasonic has increased cell production rate in Japan, reducing the constraint on production that’s held Tesla back a little.
Tesla Motors just held a factory shutdown so they could reconfigure the production lines to increase the production rate and to begin producing the Model X next year.
Tesla Motors expects to be producing cars (Model S and Model X) at a 100,000 car per year rate by the end of 2015.
They have begun deliveries in China and “right hand drive markets” (England, Hong Kong, for now, Australia may come soon).
Production in Q3 is expected to be 9,000 vehicles.
To summarize – Tesla Motors is continuing to knock it out of the park, and expects to rase its production level tremendously for just the luxury cars (S and X) ahead of launching large scale Model III production.
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