Tesla faces Federal Bureau of Investigation probe over Model 3 numbers

Tesla faces Federal Bureau of Investigation probe over Model 3 numbers

This week, Tesla reported a rare profitable third quarter and showed evidence that its Model 3 ramp, while not quite yet reliably at 5K cars per week, has improved dramatically from where the company was this time past year.

Earlier this year, Musk pledged to step up production of the Model 3 to 5,000 vehicles per week by the end of the second quarter.

"We continue to question the USA demand for the Model 3 in a post tax credit environment", he said.

The electric-car maker earned $US2.90 a share, well above the $US0.15 loss per share expected by Wall Street analysts.

Tesla Inc surprised market players on Thursday with strong quarterly earnings and its ability to generate free cash flow.

Tesla actually bumped its reporting date by almost two weeks, Forbes reports, while many observers believed it meant the company had good news, or that it didn't want to be buried under the coverage of USA midterm elections.

Tesla's mass-market electric auto - will commence United Kingdom deliveries in mid-2019, confirms CEO Elon Musk. Tesla is now building a factory in China, which will feature production lines for two models - likely the Model 3 and Model Y - to be sold in that country.

For the fourth quarter, Tesla forecasts Model 3 production and deliveries to increase quarter over quarter.

He expressed confidence that Tesla would remain profitable, despite using cash to pay off notes.

Tesla officials "were transparent about how hard it would be" to ramp up Model 3 production, said spokesman Kamran Mumtaz.

The DOJ's focus on Model 3 production had not previously been reported. But more importantly, each success built investor confidence, allowing Tesla to raise more capital for the next vehicle.

The Model 3 sedan was a huge driver for the quarter.

"That is our goal, and that is what we are pushing very hard to achieve". Tesla has the advantage of having access to millions of vehicles with autonomous driving capabilities, which is not the case for any of the other services.

The Journal reported that the FBI is investigating whether the company made production estimates that it knew would be impossible to meet. Bloomberg ran a titled "Tesla Doesn't Burn Fuel, It Burns Cash"-complete with a graphic of Musk throwing dollar bills into a pair of Boring Company flamethrowers". Nord/LB reiterated a "sell" rating and set a $230.00 price target on shares of Tesla in a report on Tuesday, September 11th.

If Tesla cuts capital expenditures, research and development on upcoming vehicles or new hiring, investors will ask whether that reflects improving efficiency or delay of necessary spending. Between the two models, Tesla plans an annual production rate of 250,000 vehicles at the factory. Manufacturing them will certainly be expensive, but now Tesla will likely be able to tap significant profits from the Model S, Model X, and Model 3 to help finance them.

Production will initially take place in California, but Tesla is "moving rapidly" to get production going in China and wants to have that going next year, according to Musk. One of the reasons it will have only one visual display is to make manufacturing easier and further reduce the amount of wiring used in the vehicle.

Musk seemed to express frustration about The Journal's story via Twitter Friday afternoon, replying to a Twitter user who suggested the story was motivated by a desire to lower Tesla's stock price.

Tesla is at something of a turning point.

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