Tesla Motors’ net loss tripled in the second quarter, compared to the same period a year earlier, as the Silicon Valley automaker’s operating expenses ballooned amid a production ramp-up.
The company also said it would launch production of the new Model X crossover in September but warned that it may slow down production of its primary vehicle, the Model S luxury sedan.
“We do think it will be quite a challenging production ramp on the X,” Musk said on a conference call.
Tesla’s net loss widened from $61.9 million in the second quarter of 2014 to $184.2 million in the second quarter of 2015. The company is expanding production of its vehicles and is investing $1.5 billion this year in a new battery factory in Nevada.
Revenues rose 21% to $878 million.
The company made 12,807 vehicles in the second quarter, up 46% from a year ago.
That helped fuel a 58.7% increase in operating expenses to $383.6 million.
The company lowered its production forecast for 2015 to 50,000 to 55,000. Investors punished the stock in trading after the markets closed, sending shares down about 5% by 5:45 p.m. to $257.14.
The earnings report underscores the breadth of the financial hurdles that upstart auto companies must surmount to make a new vehicle for a global audience.
After several delays, Tesla is poised to release the Model X within months. That will be another ultra-luxury vehicle.
Like the Model S, it will be made on the same assembly line at the automaker’s Fremont, Calif. plant. That is expected to slow manufacturing of the Model S.
“Simply put, in a choice between a great product or hitting quarterly numbers, we will take the former,” Musk said in a letter to investors. “To build long-term value, our first priority always has been, and still is, to deliver great cars.”
Still, Tesla said it expects to reach a production pace of 1,600 to 1,800 units per week in 2016, including Model X and Model S.
That would equal 83,200 to 93,600 vehicles for 2016.
Production of the Model S is expected to slow by about 800 units per week in the coming months as Model X production expands, Musk said on the call.
The company teased that it would show off the design of the Model III sedan, its first mass-market electric car, in the, first quarter of 2016. It said that vehicle will be ready to hit Tesla stores by late 2017. At that pace, Tesla is likely to trail bigger rival General Motors in the race to deliver the first affordable electric car with long range.