Cars and Drivers

Why Growth Is Muted at Tesla

Tesla Motors Inc. (NASDAQ: TSLA) is watching its shares free fall after its CEO Elon Musk made some less than positive projections on the company’s outlook at the Automotive News World Congress. Suffice it to say he predicted that the company would not have a full-year profit until 2020.

According to Musk, to reach profitability the company will need to sell 500,000 cars per year, which is not projected until 2020.

In addition to this outlook, Tesla also announced weak sales in China for the fourth quarter. Musk commented on this, saying that the weaker sales were the result of a misperception by Chinese consumers that there might be difficulty in charging the electric cars. However, Musk expects the sales issue to be resolved by the middle of the year.

At the event, Musk also mentioned that Tesla was open to partnerships with retailers to sell its cars, but this could not take place until after the company had remedied its production bottlenecks. It is worth noting that he said Tesla is not actively seeking any partnerships.

Musk further stated that Tesla could be profitable already, but the company would rather opt to invest in new technology and expanded retail networks. He has followed Google on investing in R&D and real spending on efforts that may not pay off for a decade — or ever. That may be a part of what is hurting GAAP profitability.

ALSO READ: 2014 Electric Vehicle Sales a Mixed Bag

The just-introduced Chevrolet Bolt is considered the closest competitor, in terms of electric cars, and its release is expected in 2017. However, Musk is not worried and does not see it as a competitive threat.

Shares of Tesla were down over 7% at $189.28 in Wednesday morning trading. The stock has a consensus analyst price target of $273.21 and a 52-week trading range of $162.10 to $291.42.

100 Million Americans Are Missing This Crucial Retirement Tool

The thought of burdening your family with a financial disaster is most Americans’ nightmare. However, recent studies show that over 100 million Americans still don’t have proper life insurance in the event they pass away.

Life insurance can bring peace of mind – ensuring your loved ones are safeguarded against unforeseen expenses and debts. With premiums often lower than expected and a variety of plans tailored to different life stages and health conditions, securing a policy is more accessible than ever.

A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family’s needs. Life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.

Click here to learn how to get a quote in just a few minutes.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.