Elon Musk: Tesla needs to cut costs or it will run out of money in 10 months

Defying skeptics, Tesla during the September quarter of 2018 actually managed to turn a profit of $312 million thanks to strong demand for the mass market Model 3. Tesla’s profits for the quarter were far from staggering, but it nonetheless instilled faith that the electric automaker was on a path towards financial viability.

Just a few months later, the narrative surrounding Tesla has drastically shifted. When the company last month released its earnings report for the March quarter, it posted a quarterly loss of $702 million. That said, it’s worth noting that production, deliveries, and demand for Tesla vehicles have all grown at an impressive clip over the past many months. As an illustrative example, Tesla during Q1 of 2019 manufactured 77,100 vehicles, a figure which well more than double the amount it manufactured during the same quarter in 2018.

” data-reactid=”22″>

“This is a lot of money,” Musk said, “but actually only gives us about 10 months at the Q1 burn rate to achieve breakeven!”

Consequently, Musk explained that the company will be taking a much closer look at employee expenses as it pertains to “parts, salary, travel expenses, and rent.”

Musk conceded that the soon to be implemented cost-cutting measures are “hardcore,” adding that it’s the “only way for Tesla to become financially sustainable and succeed in our goal of helping make the world environmentally sustainable.”

This isn’t the first time Musk has rung the alarm bells about drastically cutting costs, but it remains to be seen what the company can do within a 10-month timeframe.

  • Surprise: Amazon’s early Prime Day sale with $25 Fire TV Sticks is somehow still going
  • Order right now to lock in Amazon’s rare AirPods 2 discount
  • Everything new coming to Netflix this week, and everything leaving (week of May 19)
  • David Spade’s ‘Game of Thrones’ review is the best we’ve seen yet
  • Google’s Pixel 3a has a serious problem for some users, and there’s no fix in sight
  • Powered by WPeMatico