Chairman and CEO AutoNation, Mike Jackson stated that the latest stepped-up production plans from Tesla Motors, Inc. (NASDAQ:TSLA) [Detail Analytic Report] are between audacious and preposterous based on past forecasts of electric car manufacturer, CNBC reported. Mike is not alone in this feeling, many Wall Street analysts doubt the firm can even come close to its new target of 500,000 vehicles in 2018, which is two years ahead of schedule and 10 times the number sold in 2015. Mile added here they have a firm that has missed every launch and every production commitment, significantly, calling what Tesla reported it’s going to do, mission impossible.
Elon Musk, Chief Executive of Tesla stated during earnings conference call with analysts that strong demand for the upcoming, cheaper Model 3 is driving the firm’s new production plan. Musk added he sees Model 3 production of 100,000 to 200,000 in late next year. With great fanfare, Tesla revealed the Model 3 at the end of March saying the car will go into production in next year, at the starting price of $35,000. Preorders topped 400,000 in April.
Musk also stated on last week’s conference call that one million vehicles in annual production by 2020 would be his best guess. In recent years, Jackson has been complimentary of the vehicles made by Tesla, which thus far include the Model S sedan and the Model X sport utility vehicle, which start at around $76,500 and $83,000, respectively. In 2014, Jackson stuck up for Tesla, stated that it should not have to modify its practice of selling its electric cars directly to consumers in firm-owned showrooms to mollify state governments, which want cars sold through dealerships. Jackson also added at the time he’d sell Tesla vehicles if given the chance. Tesla declined to respond for immediate comment.
Chairman and CEO of Fiat Chrysler Automobiles N.V. (NYSE:FCAU) [Detail Analytic Report], Sergio Marchionne visited the Windsor Assembly Plant to officially celebrate the launch of the all-new Chrysler Pacifica and to recognize the efforts of over 6,000 people that brought the vehicle to market. WAP continued its legacy as the home of the minivan with the start of production of the sixth generation family hauler on February 29, 2016. Joined by Unifor President Jerry Dias, Unifor Local 444 President Dino Chiodo and other FCA North American executives, Marchionne told around 2,000 day shift employees during an internal event that the Pacifica will not just redefine the minivan segment, but will also redefine the role and the future of the plant.
Marchionne stated that this is the right moment to ask themselves what’s next, what they want this plant to become two years from now. His vision is clear and it is based on what you have demonstrated so far: your dedication, your passion and your openness to new ideas, in order to put out the highest quality products possible. WAP has been producing vehicles in the Ontario town for the past 88 years and is the only manufacturer still operating in the heart of the city. Many models have rolled off the line over the years, but none more well-known or recognizable than the minivan, which launched in 1983.
Since then, over 14.3 million minivans have been sold to date, of which ten million have come through the Windsor plant. Marchionne added that original vehicle represented an entirely new concept and a historic game changer when it comes to family transportation. You have earned the right to be proud of the leading role you have played in making them the undisputed leader in minivans, a tradition they fully intend to maintain with the new Pacifica.
American Axle & Manufacturing Holdings Inc. (NYSE:AXL) [Detail Analytic Report] disclosed that Board of Directors of the firm authorized a share buyback program of up to $100 million of common shares through December 31, 2018 as part of AAM’s overall capital allocation strategy. David C. Dauch, Chairman and Chief Executive Officer of the firm commented that the authorization of a share buyback program by the Board of Directors demonstrates the confidence in the firm’s long-lasting growth and strong free cash flow generation as well as their commitment to create and deliver value to their investors.
On the other side, American Axle & Manufacturing also announced earnings of $61.1 million in its first quarter. On a per-share basis, the Detroit-located firm reported that it had net income of 78 cents. The results topped Wall Street estimates. The average estimate of experts polled by Zacks Investment Research was for earnings of 71 cents a share. The firm declared revenue of $969.2 million in the quarter, which missed Street forecasts. Shares of American Axle have plunged 21 percent since the starting of the year. The stock has plummeted 38 percent in the previous twelve months.
Dauch commented on results that their strong Q1 financial results position the firm to achieve their full year 2016 financial targets. As they look ahead to the remainder of 2016, they remain focused on supporting the launch of programs in their new business backlog and advancing AAM’s product technology to drive long-lasting profitable growth and investor value.