"Honest" Tesla: After the earnings report, once again downplaying its own company, warning that mass production of Tesla is "very difficult"
Tesla stated that its production capacity target is 200,000 vehicles per year, which is much more challenging than initially anticipated.
Musk has had a tough couple of weeks. After venting his frustrations about the financial environment affecting car sales at the Tesla earnings conference, the company's stock price plummeted nearly 20% in just over ten days, while the broader market fell by 2.8% during the same period.
However, despite all this, Musk remains honest with the public.
On Tuesday, during a podcast, he once again emphasized the difficulties in producing Tesla's highly anticipated new model, the Cybertruck, with a target of producing 200,000 units per year.
Previously, Musk had stated that he had the capability to produce 125,000 Cybertrucks per year, with the possibility of increasing production capacity to 250,000 units by 2025.
During the podcast on Tuesday, he said:
"Our goal is to produce about 200,000 units per year... maybe a little more, but I have to emphasize that production is much more challenging than the initial design."
Musk also repeatedly emphasized to analysts during the earnings conference that there are many challenges in mass-producing the Cybertruck.
According to Musk, one million people have already pre-ordered the Cybertruck, but he stated that increasing production will be "extremely difficult." Tesla may be able to deliver 250,000 Cybertrucks per year, but that may not be achievable until 2025. He warned that it would be at least 18 months before the Cybertruck becomes a "significant positive cash flow contributor."
The Cybertruck is seen as a key model for Tesla's future growth, following the success of the Model 3 and Model Y, but it has experienced several delays. It has just started trial production at the Texas factory and is expected to begin deliveries on November 30.
However, Musk has expressed concerns that Tesla is "digging its own grave" with the Cybertruck.
The earnings report shows that Tesla's revenue in the third quarter of this year was $23.35 billion, a 9% increase compared to the same period last year, but the slowest revenue growth in three years and lower than analysts' expectations of $24.06 billion. Both gross profit and net profit were also lower than analysts' expectations. The GAAP gross margin was 17.9%, marking the third consecutive quarter of decline and falling below market expectations in each quarter.