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.