As he spoke at an auto industry gathering on Tuesday, Tesla Motors Inc.’s CEO Elon Musk said that the company may start earning profits only after 2020. Also, the luxury electric-car maker has observed weakened sales during the fourth quarter in the Chinese auto market. Musk stated that the company is looking at ways of fixing the problems to lure more consumers.
Musk also stated that the much awaited Tesla Model X SUV is also sought to be launched in this summer. This sports utility vehicle, when it gets launched, will play a critical role for the company and help it in reaching annual sales targets of 500,000 vehicles per year by 2020.
Tesla shares observed a decline of nearly 7 percent to US$190.50 from US$204.25 on the Nasdaq in after-hours trade. Such a decline is clearly not expected by the company as it rose to prominence and observed an increase in its stocks by nearly 48% only a year ago.
Musk spoke at the auto conference that the green car maker will bring another series of vehicles, Model 3 by 2017. The car will cost around US$35,000 without tax credits at its launch. After the company starts earning profits and enters a stable sales phase by 2020, it will be able to do sales in millions by 2025.
Musk also said that the company could make money right now too if it weren’t investing in new models and for expanding its retail network. He did not elaborate on the specific issues the company is facing in the Chinese market.