In a bold prediction for the future, Tesla Motors CEO Elon Musk tells investors the company will be producing up to 100,000 cars a year by 2015.
This will mostly be possible when Tesla finishes building a Gigafactory (in partnership with Panasonic) which will be responsible for churning out the lithium-ion batteries that the company's electric cars will be needing. There are still speculations as to where the first Gigafactory will be located but Musk has confirmed that ground has been broken in Nevada. The final site will be announced in a few months.
Musk has every reason to be positive about the future because if last quarter's performance is any indication, Tesla Motors is on the right path. Revenue was reported at $769 million, a jump from $405 million in the same quarter in 2013. Aside from stable sales of the Tesla Model S, growth can also be attributed to steady powertrain sales the company made thanks to Toyota and Daimler which amounted to $23 million.
Musk's 100,000-a-year projection is generally pegged on the Model S and Model X, but Tesla Motors is also banking on the success of the Model 3, a mass-market vehicle that will cost $35,000. That's half the price of the Model S which can run up to $100,000 with options. A sports utility vehicle model, the Model X will be available starting spring 2015.
Other ways Musk is looking to improve Tesla Motors is in speeding up car services. Formula One mechanics have been brought in to teach how cars can be fixed in record speed. Instead of the usual one-person-per-bay arrangement which takes several days to finish fixing a car, a team will work on a car at the same time. If the new arrangement is realized, it will be possible to finish fixing cars within the workday.
"We plan to invest between $750 million and $950 million in 2014, an increase of $100 million from prior guidance. We continue to invest in additional production capacity, continued Model X and Model S development, Gigafactory construction, and further expansion of our sales, service, and Supercharger footprints. We have also chosen to slightly accelerate our investments in production capacity and the Gigafactory. It will indeed be a busy second half of the year as we execute on the opportunities ahead," writes Musk and Chief Financial Officer Deepak Ahuja in a letter to Tesla Motors shareholders.