Tesla Motors Reports Wider $38.5M Loss, But Says It’s On Track

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897 views Aug 5, 2010

Tesla Motors CEO Elon Musk with Tesla Roadster

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As predicted, Tesla Motors posted higher losses for the second quarter during its earnings announcement today — its first as a public company. The electric vehicle maker says it brought in $28.4 million revenue, but lost $38.5 million ($5.04 a share), up from the $29.5 million lost last quarter and $10.8 million last year.

Considering that the Palo Alto, Calif. company just purchased a major automotive plant in Fremont, Calif. for $42 million and is scaling up development of its Model S sedan, the loss was expected. The company cites its 5.4 percent growth in revenue for the quarter (ended June 30) as a sign that it’s still on track.

Tesla went public at the end of June, making it the first automotive company to do so since the Ford Motor Company in 1956. It sold 13.3 million shares and raised $226 million in one of the most successful IPOs this year and the only blockbuster offering in the cleantech sector.

Shares of TSLA closed at $21.26 on the Nasdaq, down 3.14 percent today. Its stock originally priced at $19 and was expected to dwindle as the IPO buzz died down, but it’s remained fairly resilient.

Tesla has been very clear that it doesn’t expect to turn a profit until the Model S is released in 2012. It doesn’t have another major product launch planned for the interim and says it will spend close to half a billion dollars on development over the next 10 to 12 quarters.

That said, CEO Elon Musk assured investors in a Bloomberg Television interview earlier today that the company has enough runway to launch the $57,400 sedan, which should cost about $400 million to get to market.

Many critics doubt that Tesla will be able to hit its 2012 deadline for the new car, arguing that its prior vehicle, the $109,000 Roadster, endured several delays. But the company says that the Model S is on track so far, with prototypes for its powertrain and battery already undergoing in-house testing, and the recent finalization of its external design, which has already been released to external parts vendors.

The immediate goal is to get an alpha version of its Model S out the door, which will have 8o to 90 percent of features in common with the finished product. To this end, the company says it has already sourced certain parts of the car, including the seats, seat belts, wheels, tires and 17-inch touchscreen.

The sedan is unique in that Tesla will be building the car’s body in addition to the battery pack and powertrain. In the past, its Roadsters’ chassis were supplied by Lotus.

While the Model S inches ahead, the company is relying heavily on its Roadster business — about $23.9 million in revenue came from automotive sales alone in Q2. According to Musk, the second quarter saw a jump in Roadster orders, bringing them to their highest level since the record-setting third quarter of 2008.