Tesla Pushes Back Model 3 Manufacturing Forecast, Again

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Tesla initially intended on reaching this mark at the end of December.

Tesla shares fell as much as 3.6 per cent to US$305.68, the biggest intraday drop in five weeks.

Although charging points are becoming more commonplace, buying an electric vehicle still brings some uncertainty with regard to how far and where you'll be able to travel.

In short, Tesla's initial Model 3 production goal is about six months behind schedule.

"We believe a fundraise will be necessary for Tesla in 2018", wrote Brian Johnson, an analyst at Barclays Plc, in a report to clients Thursday. These include the construction of new factories, the buildup of the solar and battery business, and the introduction of new models, such as the Tesla Semi, Roadster and Model Y. He projects the company will burn through US$4.2 billion this year and assumes the company will raise US$2.5 billion through an equity offering, likely during the third quarter.

As of September 30th, Tesla's cash and cash equivalents were estimated at $3.5 billion.

The estimates for Model 3 deliveries by different brokerages varied widely.

Tesla delivered a record-breaking 29,870 vehicles in the fourth quarter of 2017, of which 15,200 were Model S, 13,120 Model X, but just 1,550 were the cheaper "mass-market" Model 3s ($35,000?29,000).

In a release on Wednesday afternoon, the company run by billionaire entrepreneur Elon Musk said it plans to hit a milestone of making 5,000 Model 3 vehicles per week by the end of the second quarter of this year.

While investors certainly won't look at another Model 3 production delay favorably, they may at the very least find solace in the fact that interest in the Model S and Model X is higher than it's ever been. Full-year 2017 vehicle deliveries reached 101,312, 33% higher than 2016.

Tesla's bonds due in 2025 were quoted at 94.9 cents at 8:30 a.m., according to Trace bond price data, the lowest in about a month.

Beyond the Model 3, Tesla's overall auto deliveries were on target for the fourth quarter and the year as a whole.

The company has said more than 400,000 people have put down $1,000 refundable deposits on the Model 3.

Tesla shares gained 45% in 2017.

Analysts said on Thursday they continue to believe that sales of the Model 3 sedan could transform the niche automaker into a mass producer, giving it an edge over a host of rivals such as General Motors and BMW who are entering the nascent electric auto market.

The company said it has made "major progress" toward eliminating Model 3 production bottlenecks. But Tesla has skipped many incremental steps used by established carmakers when launching new products.

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