As Tesla Ramps Up Production, Investors Want to See Profitability
*By Conor White*
Tesla may have posted a record-breaking third quarter for production ー over 80,000 cars were built in the past three months, 50 percent more than its previous high mark set the period before ー but it seems investors have their doubts.
Shares fell more than 2 percent Tuesday after an encouraging [rebound](https://cheddar.com/videos/musk-settles-sec) the day before.
"This is a company that just seems to go from one crisis to the next," Investor's Business Daily senior reporter Brian Deagon said Tuesday in an interview on Cheddar.
The current issue: the ongoing trade war between China and the U.S. According to Tesla ($TSLA), it costs the company 55 to 60 percent more than Chinese automakers to produce "the exact same car," given the latest tariffs imposed by the Trump administration. That only adds to the company's ongoing financial strain and puts more pressure on CEO Elon Musk who in early August predicted a profit in the second half of the year.
"The company's got a cash flow problem," said Deagon. "They've got a huge debt they need to pay off in the next year and a half or so ー so profitability is going to be very important."
Tesla produced a grand total of 80,142 vehicles in Q3: 26,903 Model S and Xs and 53,239 Model 3 sedans. It also output 5,300 Model 3s in the last week of the quarter alone.
Those numbers were better than expected, but investors may not be so quick to forget the scandalous summer, starting with Musk's Aug. 7 tweet that he had "funding secured" to take Tesla private, a message that ultimately led to securities fraud charges and a settlement with the SEC this weekend that requires Musk to cede his chairman role for three years but allows him to stay on as CEO.
And Tesla still faces what Musk has called "delivery logistics hell." Many customers have said they're [still waiting](https://www.businessinsider.com/elon-musk-says-tesla-customers-may-get-delayed-response-2018-9) for their cars.
Deagon said despite his many obstacles, Musk still deserves credit for what he's accomplished so far.
"He's doing something nobody has ever done before," Deagon said. "He is completely, single-handedly almost, revolutionizing the auto industry ー converting it to all-electric."
"The guy's practically busted his brain in half trying to get everything together, but so far he seems to be pulling it off despite many bumps in the road," he added.
Despite the SEC's lawsuit, delivery issues, and Tesla's continued struggle to produce enough Model 3s every week, Deagon advised not to bet against Tesla, or Elon Musk.
"He continues to overcome these big obstacles," Deagon said. "And he has a history of that."
For full interview [click here](https://cheddar.com/videos/tesla-production-shifts-into-high-gear).
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