|Tesla shares up 19 pct. as company sees 1Q profit||| Print ||
|Written by The Associated Press|
|Monday, 01 April 2013 11:03|
DETROIT (AP) — Shares of electric car maker Tesla Motors Inc. jumped more than 19 percent Monday after the company said sales are running ahead of schedule and it will post a first-quarter net profit.
The Palo Alto, Calif., company said Sunday night that first-quarter sales have exceeded 4,750 Model S sedans, above prior guidance of 4,500. Previously the company said it would be slightly profitable in the first quarter, excluding noncash option and warrant expenses.
Shares of Tesla were up $7.35, or 19.4 percent, to $45.24 in morning trading Monday. Earlier in the session the shares hit a record high of $45.47.
"There have been many car startups over the past several decades, but profitability is what makes a company real," Tesla co-founder and CEO Elon Musk said in a statement. "Tesla is here to stay and keep fighting for the electric car revolution."
Tesla, the brainchild of Musk, who founded PayPal and SpaceX, was selling two all-electric models last year, the $109,000 Roadster and the Model S, which starts at $49,900 after a federal tax credit. The Roadster was phased out as the Model S went on sale. The Environmental Protection Agency estimates that the Model S can travel about 265 miles on a single charge.
Tesla has lost money since sales of the Roadster began in 2008, and the company is banking on the cheaper Model S to expand its market. But it said production costs should fall as it produces more vehicles.
The company lost $396.2 million, or $3.69 per share, last year, compared with $254.4 million, or $2.53 per share, in 2011.
In February, Musk said his company plans to pay back a 10-year, $465 million U.S. Energy Department loan in half the time required by the government.
But last week he hinted that payment may be coming even sooner. He said on Twitter that he is "going to put my money where my mouth is" in a major way. An announcement of some sort is coming on Tuesday.
Jefferies analyst Elaine Kwei said in a note to investors Monday that she expects high levels of activity in Tesla stock due to speculation about Musk's announcement Tuesday.
She told investors that after tweeting about the major announcement, Musk tweeted about rooftop solar and battery packs.
Tesla made its first loan payment of nearly $13 million in December. A second payment is due this month.
Tesla also said in a statement Sunday night that it's dropping an option for a smaller, less-costly battery pack on the Model S because so few people have taken it. All cars will now come with a larger 60 kilowatt-hour battery pack. Those who choose the smaller battery pack will be limited to 40 kilowatt-hours by software, but the owners will be allowed to upgrade.
Copyright 2013 The Associated Press.