Tesla reports deepening losses

image copyrightGetty Images

Tesla reported a loss of $293m (£220m) for the second quarter - the electric car maker's thirteenth consecutive quarterly loss.

Sales for the period from April to June were $1.3bn, which was less than analysts' forecasts of $1.6bn.

Tesla delivered 14,402 cars during the quarter missing its target of 17,000.

It is the second consecutive quarter that Tesla has missed production targets, raising doubts about whether it will reach its full year goal.

Tesla reported that nearly half of its second quarter production occurred in the final four weeks of the quarter.

But the company said it was on track to deliver 50,000 Model S and Model X vehicles in the second half of the year.

New vehicles orders rose by 67% compared to the same time last year.

"Making cars is hard... and they still are in the growth stage. The market seems to want to give [Mr Musk] the benefit of the doubt," said Ivan Feinseth an analyst at Tigress Financial Partners.

In the second quarter Tesla completed the design work on its Model 3 sedan and intends to start production before the end of the year.

The Model 3 is Tesla's attempt to widen its market appeal with a more affordable car. Its starting price is expected to be $35,000.

Expansion plans

The company also plans to add new stores in Taipei, Seoul, and Mexico City along with extra outlets in markets where it already has a presence, such as California.

Tesla's chief executive Elon Musk announced last month plans to expand the company's vehicle line to include electric trucks and buses.

He opened the firm's Gigafactory in Nevada last week which Tesla promises will dramatically lower the cost of batteries for cars.

image copyrightTesla
image captionThe Gigafactory, about half an hour's drive from Reno, Nevada, is only 14% completed

The BBC's Dave Lee described the factory as "a solid vision of the future of manufacturing" after taking a tour of the facility.

And on Monday, the company announced a deal to buy solar panel company SolarCity for $2.6bn.

Some investors have questioned the viability of the deal as both Tesla and SolarCity continue to report losses.

There were also questions about the close links between the two firms - Mr Musk is already chairman of SolarCity's board and his cousin Lyndon Rive is the company's chief executive.

Once the companies are combined Mr Musk's ownership stake will increase from 23% to 25%, leaving him as the largest shareholder.

He has called the deal a "no-brainer" and said the tie-up would save $150m a year.

SolarCity has until 14 September to solicit offers from other potential buyers.

Related Topics

More on this story