Tesla Motors reported a loss of 61.9 million, or 50 cents per share, in the second quarter due to large expenditures ahead of the launch of a new car and the construction of a new plant. The company almost doubled its losses from the same quarter a year ago, when it reported a loss of $30.5 million or 26 cents per share.
During the period, the company delivered 7,579 Model S vehicles, slightly higher than the 75,000 units for its forecast. However, it spent heavily on investments, particularly on the expansion of its assembly plant in Fremont, California. A large chunk of its funds went to developing its Model X SUV, which is expected to go into production by early 2015. The company also spent significant amounts on improving its Fremont, California factory. For the facility, the company built a new assembly line, which would make it possible to produce the Model X and the older Model S in the same location. With the improvements, the plant's production capacity has been boosted to 1,000 cars per week.
Tesla said that it expects to meet its projection of delivering 35,000 vehicles this year. This is spite of the company's warning to shareholders about a temporary slowdown in production during the summer. This is due to the scheduled two-week shutdown of its Fremont plant as it prepares for production of the Model X.
Earlier this week, it was revealed that Tesla and Panasonic had agreed to deal to build and operate the biggest battery factory in the United States. The facility, which has come to be known as the Gigafactory, involves a $5 billion investment. Musk told Reuters that his company will shoulder 40 to 50 percent of the amount needed to put up the facility. The factory is part of Tesla's plans for producing mass market electric cars. The Tesla Model 3, which costs around $35,000, is expected to launched by 2017.
Once the facility goes into operation, it is expected to provide Tesla with batteries for up to 500,000 vehicles per year. Musk said that his company had broken ground in Reno, Nevada for a possible site for the Gigafactory. However, they are also looking at sites in Texas, California, New Mexico and Arizona.
The company expects a boost in production over the next two quarters. The company forecasts deliveries of 7,800 cars in the third quarter and 13,000 in the fourth quarter.
