In more than three years, Tesla Motors Inc. gained its first quarterly profit by nearly $139 million in sales of vehicle credits. Tesla Chief Executive Elon Musk is confident that the sales of his clean car empire would turn a profit once more come fourth quarter of this year.
He told reporters that production for Model 3 would no longer require any capital raise as the electric carmaker reveals it has substantially reduced the costs of processing the much-coveted sedan.
According to Reuters, Musk said the company might still raise capital, however, to "account for uncertainty" as well as to "de-risk the business." The tech billionaire has previously made promises to his investors regarding profitability, product manufacturing, and launches only to disappoint them afterwards. But this time, Musk has made it clear that Tesla is truly a promising company people should invest in.
"Certainly what drove the upside on profit is the $139 million of those zero emission credits," Cowen analyst Jeffrey Osborne said.
As reported by the Los Angeles Times, "On first read, it appears they're paying closer attention to making money," Autotrader senior analyst Michelle Krebs said. "It's significant they actually posted a profit. This is a milestone everyone's been waiting for."
The third-quarter profit reports hope to quell Musk's most vocal critics and skeptics, who have been raining on his parade ever since he announced his ambitious plans of replacing every single car in the world with a fully sustainable electric vehicle. Tesla has been a crowd favorite among tech geeks but it still has to prove business sustainability and profitability.
With the help of its most recently acquired company, SolarCity, Musk aims to bring solar-powered cars into the mainstream market. Musk also plans to push the public to switch to self-driving cars which effectively decrease, if not totally eliminate, road accidents.
