The electric car maker said it had delivered its first Model 3 sedan to a customer on Thursday, the same day that it reported first-quarter sales of $1.2 billion, an increase of 36% from the same period last year. The company also said it will cut the price of its Model 3 sedan by $35,000 before the end of May.
Tesla said in a statement that it has been working hard to build out its production line in order to meet demand for the new vehicle. It added that it has reached weekly production goals for all vehicles except for Model X and Model S, where production is still ramping up."We are focused on building more cars faster and are confident we will achieve this as we continue to grow our manufacturing capacity," Tesla said in a statement issued on Thursday.
But even more impressive is that Tesla has achieved this without slashing the number of units it produces. In fact, Tesla says it will produce the same number of vehicles this quarter as last quarter.
That's because Tesla has been able to greatly increase its production capacity at its Fremont factory by adding new machinery and staff. That's important now because demand for electric vehicles is booming — both in the U.S. and around the world — and Tesla needs to be able to meet that demand even as it continues to ramp up production of its next vehicle: The Model Y compact SUV. Tesla sales rose 36% in the first quarter, by following price cuts that dropped vehicle prices by $5,000.
Tesla's first-quarter net income was $10 million, compared with a loss of $404 million in the year-earlier period.
The company also said its Model 3 sedan has racked up more than 400,000 paid reservations since it went on sale in February.
Tesla said it has made more than 1 million Model 3 vehicles and delivered almost 9,300 of them to customers in the quarter. The company plans to produce 10,000 Model 3s per week at some point this summer and 20,000 by the end of 2023.
Tesla Inc. (TSLA) reported record first-quarter sales, but warned that profit and cash flow will be lower than Wall Street expected. The electric car maker also said it will cut prices by $2,000 to $3,000 on all models this quarter as it tries to boost demand for its vehicles.
Tesla posted a 36% rise in first-quarter sales from a year ago to just over $2 billion, but it expects gross margins to fall below 40% because of higher prices for components and the cost of goods sold. It expects operating expenses to increase by about $500 million in the second quarter. Tesla sales are rising rapidly with the help of mastermind Elon Musk. In the last three months, Tesla sold more than 23,000 cars in the U.S., which is an impressive increase from last year's figure of 16,000 cars.
The company has also managed to sell over 20,000 cars in China and Canada alone. These numbers are likely to rise even further in the coming months as Tesla makes some big changes in its business model.
Tesla is planning to move towards a service-based business model where it will provide customers with maintenance and repair services for their vehicles as well as providing them with new parts if they need them. The company also plans to start offering car leasing solutions for its customers and will partner with other companies who offer these services like Hertz or Enterprise to help customers find a car that suits their needs better than Tesla currently does.
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