August 1, 2018 / 8:31 PM / 2 months ago

UPDATE 1-Tesla expects to hit more than 6000/week Model 3 production rate

(Adds details from the statement, shares)

(Reuters) Aug 1 - Tesla Inc said on Wednesday it expects to increase Model 3 production to 6,000 per week by late August, buoying expectations that the Elon Musk-led electric vehicle maker will meet its goal of profitability and positive cash flow in the next two quarters.

Tesla said it expects to produce 50,000 to 55,000 Model 3s in the third quarter. The company said it had repeatedly hit weekly production of about 5,000 Model 3s multiple times during July.

The company said it produced 53,339 vehicles in the second quarter and delivered 18,449 Model 3s.

“We aim to increase production to 10,000 Model 3s per week as fast as we can,” the company said.

Chief Executive Musk is under intense pressure to prove he can deliver consistent production numbers for the new sedan, which has faced a host of manufacturing challenges since last year. The company has consistently denied it will need to raise cash but several Wall Street analysts expect a move by the end of the year.

Tesla ended the second quarter with $2.78 billion in cash after spending $609.8 million in quarterly capital expenses.

Free cash flow, a key metric of financial health, narrowed to negative $739.5 million in the second quarter from negative $1 billion in the first quarter, excluding costs of systems for its solar business.

The company last quarter cut its spending forecasts and Tesla has begun to lay off 9 percent of its workforce.

Tesla reported a loss of $717.5 million, or $4.22 per share, for the second quarter ended June 30, compared with a loss of $336.4 million, or $2.04 per share, a year earlier.

Excluding items, Tesla reported a loss of $3.06 per share.

Total revenue rose to $4 billion from $2.79 billion.

Tesla shares were up 5 percent at $316.45 in after-market trading on Wednesday. The stock has slumped 19 percent since a 2018 high of $370.73 in June. (Reporting By Alexandria Sage and Sonam Rai; Editing by Sriraj Kalluvila)

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