Tesla Motors, Inc. (NASDAQ:TSLA) [Detail Analytic Report] inched up 0.22% during pre-market trading session on Fridays as the electric-car maker announced a narrower than anticipated Q1 adjusted loss and quarterly sales in line with Wall Street estimates, MarketWatch reported. In addition, the firm ramp up its plan to produce 500,000 cars to 2018; two years earlier than it had earlier planned, and renewed its promise to have the Model 3 ready for production and sales by the end of 2017. Doubts crept in just after Elon Musk, Chief Executive of Tesla laid out those promises, however, with some talking about how the man who wants to launch a rocket to Mars by 2018 has had some issues in the past with over-promising and under-delivering.
Musk goals for the electric car manufacture may be even more ambitious. The production ramp is in response to outsize enthusiasm for Tesla Model 3, the lower-priced Tesla car that prompted hundreds of thousands of customers to plunk down a $1,000 deposit after it was revealed. Tesla managed to produce a record 15,510 vehicles in the Q1 of the year, and hopes to push that to 20,000 this quarter and 50,000 in the second half of 2016. Musk stated that Tesla is going to be hell-bent on becoming the best manufacturer on earth.
Karl Brauer, analyst at Kelley Blue Book stated that he has a history of not ever delivering on time. Musk has had to walk back his original annual deliveries forecast the previous two years in a row, and the Model X arrived roughly two years after the original target date. Tesla reported that its advanced production schedule would preclude its cash-flow goal and require raising more capital. Brauer added that other auto manufacturers with intends to launch new models in the 2017 calendar year likely have parts in hand and are getting ready to roll. Musk added he has established a July 1, 2017, deadline for volume production of Tesla Model 3, but admitted on the conference call that the July 1 date is not a date that will actually be met.
Chief Executive of Fiat Chrysler Automobiles N.V. (NYSE:FCAU) [Detail Analytic Report], Sergio Marchionne stated that a newly-struck deal between Google and Fiat Chrysler Automobiles for a fleet of 100 self-driving cars is not exclusive, according to Reuters. Marchionne added that, under the agreement, the two firms could talk to other players, but it’s not clear whether the technology developed under the FCA-Google project would be shared with other manufacturers. The deal, reported earlier this week, marked the first time that a Silicon Valley firm has collaborated with a traditional carmaker to develop an autonomous vehicle.
Marchionne also noted that FCA had no more contacts with competitor General Motors since his merger proposal was rebuffed. Moreover, Fiat Chrysler’s new Alfa Romeo Giulia sedan is anticipated to create 3,400 jobs in Italy. Fiat Chrysler is looking to extend output in Italy and Renzi stated that the manufacturing will be a boon to the Italian economy, which grew only 0.8% in last year.
Ferrari Financial Services, an Italian indirect subsidiary of Ferrari N.V. (NYSE:RACE) [Detail Analytic Report] and FCA Bank S.p.A. reported that they have inked a memorandum of understanding for FCAB to acquire a majority stake in Ferrari Financial Services AG, a wholly owned subsidiary of FFS S.p.A. As a result of the deal, FFS S.p.A. and FCAB will continue the operations of FFS AG as joint venture partners, supporting the sales of Ferrari cars in certain European nations by offering innovative vehicle financing solutions to Ferrari customers.
The funding of the joint venture will be delivered by FCA Bank, which will also be the consolidating entity. FFS S.p.A. is Ferrari’s own financial services provider based in Maranello, Italy. FCAB is a banking group, and a joint venture between Fiat Chrysler Automobiles Italy S.p.A. and Crédit Agricole Consumer Finance S.A., predominantly operating in the automotive financing sector in Europe. This deal will extend FCAB activities and is consistent with its diversification strategy.
The parties agreed not to reveal any financial details about the deal. The MoU will be transformed into a set of definitive contracts later 2016. The consummation of the deal is subject to approvals of rivalry and banking regulatory authorities.