Tesla produced more than 5,000 Model 3 sedans in the last seven days of June, the company said on Monday, reaching a goal it has said is critical to its bid to turn a profit in this year’s final two quarters.
The electric-car maker is counting on the Model 3, its first mass-production vehicle, to increase revenue and offset the billions of dollars the company has been spending on setting up a huge battery plant in Nevada; manufacturing the Model 3 at its car plant in Fremont, Calif.; and developing the Model 3 and other vehicles.
[Read more: To reach its production goal, Tesla started building cars under a tent, and it says Elon Musk slept at the factory.]
The production report appeared to have a positive impact on Tesla shares, which were trading at about $353, up about 3 percent, in the late morning.
In the second quarter, Tesla produced 28,578 Model 3s, about three times more than in the first-quarter, the company said in a regulatory filing. Output for Tesla’s two other vehicles — the Model S luxury sedan and Model X sport-utility vehicle — totaled 24,761 combined. Production of all models totaled 53,339 vehicles, a 55 percent jump from the first quarter.
Tesla delivered just 18,440 Model 3s to customers in the quarter, and 11,166 were in transit, a result of having increased production so late in the quarter. Combined deliveries for the Model S and X came to 22,300 vehicles.
Tesla has been struggling with bottlenecks and other glitches in its Model 3 assembly process, and was making only about 2,000 of the cars a week at the beginning of the quarter. The company has streamlined its production line by replacing complicated robotic machinery with human workers. In June, Tesla erected a giant tent just outside the walls of the Fremont plant, where it cobbled together a new production line to hasten final assembly of the cars.
The assembly problems had mostly plagued two Model 3 final assembly lines Tesla has set up inside the plant, although there were also production slowdown in the paint shop.
The company has never reported an annual profit in the 15 years since its founding. In the first quarter, Tesla recorded a loss of $785 million on revenue of $3.4 billion. And the company consumed $745 million in cash, up sharply from $112 million in the previous quarter.
Alarmed by both the cash burn and the lagging increase in assembling Model 3s, Moody’s Investors Service cut Tesla’s credit rating in March.
With the three assembly lines running, Tesla built 5,031 Model 3s in the final seven days in June; about 20 percent came from the line set up in the tent outside the plant.
Tesla has delivered 28,386 Model 3s to date and has reservations for approximately 420,000.
