In a company update released Wednesday to investors, Tesla formally confirmed the launch of the Model Y electric crossover has been moved up to summer 2020.
To meet that timeline, production of the Y could begin as soon as early 2020, versus the summer to fall 2020 timeline (with first deliveries before the end of 2020) that Tesla had originally suggested.
The automaker reported that equipment installation was underway ahead of the launch, and that part of quick setup is due to efficiencies gained in building the Gigafactory Shanghai. Tesla didn't detail exactly where it's finding the space to build the Model Y, prior to its call with investors.
Tesla also confirmed that trial production has begun for the Model 3 in Shanghai—also ahead of schedule.
“We have cleared initial milestones toward our manufacturing license and are working towards finalizing the license and meeting other governmental requirements before we begin ramping production and delivery of vehicles from Shanghai,” Tesla said in its report.
Those two points weren’t the only good news to come from Tesla in the investor letter.
Wall Street analysts anticipated a loss, but the company reported its first profitable quarter of the year—after profitable third- and fourth-quarter performances last year. But it reported revenue of $6.3 billion, just below the previous quarter’s $6.35 billion, and $143 million in net income (80 cents per share), versus $311 million ($1.91 a share) in the third quarter for 2018.
Additionally, as another indication that the company may be operating more efficiently, Tesla is making more money from Model 3 without raising the price for the sedan. It says that operating expenses are at the lowest level since it started making the electric sedan, and that gross margins on the 3 have strengthened.
The one product currently in the pipeline that remains delayed from its originally expected timeline is the Tesla Semi. Although originally set for a production start in 2019, Tesla reiterated a delay announced in its first-quarter call, saying that it is “planning to produce limited volumes of Tesla Semi in 2020.”
In the third quarter of 2019, Tesla reported a total vehicle production of about 96,000 vehicles, with (global) deliveries of 97,000 vehicles. Tesla is expecting to exceed 360,000 global deliveries in 2019.
The update provided no additional information on the timeline of the Roadster or the Pickup, although Tesla CEO Elon Musk said that its introduction (likely in prototype form) is planned for November.
As for the non-vehicle portions of Tesla’s business (energy management and storage), Tesla says that it also anticipated an announcement soon regarding the location of its European Gigafactory—for production in 2021—a signal that the automaker may be diversifying deeper into proprietary cells in the near future. And first deliveries of the Megapack—Tesla’s 3-mwh single-unit energy storage system that’s assembled at the Gigafactory—will also start by the end of the year.
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