Can Tesla Sell 500,000 Cars a Year?

By Douglas A. McIntyre Updated Jan 13, 2:09AM EST · Published Oct 20, 9:10AM EDT

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Can Tesla Sell 500,000 Cars a Year? — © courtesy of Tesla Motors

Shadowing the Tesla Motors Inc. (NASDAQ: TSLA) installation of self-driving car systems into the company’s vehicles are the facts that Tesla has said it cannot deliver its Model 3 until mid-2018, this firm’s need for money and a claim that the manufacturer can sell 500,000 cars a year by 2018.

Tesla’s original goal to hit the 500,000 milestone was set in August 2015. It was moved forward last May. Tesla delivered 15,800 cars in the third quarter.

Things could fall apart rapidly at Tesla. The construction of its Gigafactory could be too slow. Production rates could hit a pothole, as they clearly did for the Model 3. Tesla could get low on money.

In late August it was presumed that, due to Tesla’s cash burn and its buyout of Solar City, it would need several hundred million by early next year, and perhaps $1 billion by mid-year. Musk said he would not need the money this year. However, that does not mean he won’t need a slug of money early in 2017. Tesla will raise the money, but the prices probably will be dear because of the rising risks that Tesla cannot outpace its competitors.

Even a self-driving car can’t produce cash.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.