Electric car company Tesla Motors Inc. reported a first-quarter loss and said sales of its Model X sport utility vehicle will be delayed until next year.
In its report to investors Wednesday, the Palo Alto automaker said it lost $49.8 million in the first quarter compared to a profit of $11.2 million in the same period a year earlier. Last year's profit was helped by heavy sales of special California zero-emission-vehicle environmental credits to other automakers, a business that dried up in the latest period.
However, the company did earn $17 million in the latest quarter, compared to $15.4 million a year earlier when certain adjustments are made to its financial statement, such as factoring back in profit deferred for lease accounting.
Revenue rose to $620.5 million in the latest quarter compared to $561.8 million a year earlier.
Tesla shares fell $5.93, or 3% in after-hours trading following the report.
The automaker produced a 7,535 Model S sedans at its Fremont, Calif., factory during the latest quarter, a record for the company. It delivered 6,457 vehicles to customers during the period and built up an inventory it will use to fill demand in Europe and China.
The electric car company is demonstrating that it can competently ramp up production and operate consistently, said Thilo Koslowski, an analyst at Gartner Inc.
But Tesla should be concerned about the delay into next summer getting its second vehicle, the Model X, into showrooms, he said.
"Right now is a golden opportunity for Tesla to conquer the market, but they need more models," Koslowski said. "This ideal condition of not having competitors to worry about can't last forever."
The company might consider a facelift or refresh for Model S, a technique other automakers use to reignite interest in their models as they start to age, Koslowski said.
"Some of the initial Model S sales excitement has cooled off. It is probably a reality check for the company," Koslowksi said.
Tesla Chief Executive Elon Musk told shareholders that the company continues to make headway on a number of fronts.
It is now manufacturing at almost 700 vehicles per week, up 15% from the rate at the end of the fourth quarter and on the way to an expected 1,000 per week by year end.
It is starting to build right hand drive cars for sale in the United Kingdom, Japan and Hong Kong. Meanwhile the Shanghai government said that Model S drivers in the city will be entitled to free license plates, allowing them to avoid the public auction price of $10,000 to $15,000 per plate.
Model X styling has been completed and Tesla is starting to work with suppliers to build the tooling needed to assemble the car.
Musk said Tesla is still working on its so-called Gigafactory project – a plan to build a giant battery cell factory in the U.S. that will start operating in 2017.
"We have not yet finalized the ultimate location for the Gigafactory and we are going to start work on at least two locations in parallel in order to minimize risk of delays arising after groundbreaking," Musk said. "Planning discussions with Panasonic and other potential production and supply chain partners continue to go well and we are pleased with the high interest level in the project."
Tesla expects to deliver about 7,500 Model S vehicles in the second quarter and about 35,000 for the year. Production should climb to 8,500 to 9,000 cars in the second quarter, representing a 13% to 19% increase over the just completed quarter.