In July 2017, Tesla CEO Elon Musk announced that even before the automaker company began its mass-marketing for Model 3, it witnessed people reserving over a half million units from Tesla directly.
A month later, the report came Tesla has been readying itself for its upcoming “production hell”, blowing through more than $1 billion a quarter to produce the Model 3, a $35,000 car that’s looking less likely to generate a return anytime soon.
According to a Bloomberg report, the electric-car maker has been burning money at a clip of about $8,000 a minute (or $480,000 an hour). At this pace, the company is on track to exhaust its current cash pile on Monday, Aug. 6.
However, Musk is very well aware of the situation as he last week unveiled his latest plan to raise funds. He’s also asking customers to pay him upfront to order vehicles that may not be delivered for years.
Experts also believe as the company ramp up output of its Model 3 it will open up the cash flow.
Tesla also has said it has ample money to meet its target of producing 5,000 Model 3 sedans by the end of March. After that date, the company expects to “generate significant cash flows from operating activities
Last week, the company launched its another masterpiece Roadster. The base model will be able to travel from 0-60 miles per hour in 1.9 seconds, which would be a record. It will go 0-100 miles per hour in 4 seconds. It will have a 200 kilowatt hour battery pack and will be able to drive 620 miles on a single charge.
The Founders Series Roadster will cost buyers a $250,000 down payment even though it’s not coming for more than two years. Orders of those cars are capped at 1,000, meaning they alone could generate $250 million. Tesla is charging a total of $50,000 for reservations of the regular Roadster.
Companies can also pre-order electric Semi trucks for $5,000, though they don’t go into production until 2019.
The Bloomberg expert said that whether they can last another 10 months or a year, he needs money, and quickly, who estimated Tesla will be required to raise at least $2 billion in fresh capital by mid-2018.