Tesla CTO JB Straubel to step down after 16 years' service

Tesla CTO JB Straubel to step down after 16 years' service

In a financial call held Wednesday, that scrutiny took form around pinch points for profitability and pricing, after Tesla announced it had lost $408 million (or $2.31 a share, unadjusted), while sales soared and the company boasted of higher production efficiencies.

The period represented, from April through June, had its challenges. Tesla other's cars, the Model S and Model X, both sell for more than $70,000 - far beyond the reach of most consumers.

The amount of the tax credit that US buyers can claim for Tesla vehicles dropped from $7,500 to $3,750 on January 1, and then to $1,875 on July 1. That led to the reconfiguration of model lines and some price reductions in recent months.

That's another quarter of record vehicle deliveries, after hitting records in the third and fourth quarters of past year.

There was some positive news about Tesla's storage business: Powerwall and Powerpack deployment grew by 81 percent in the second quarter to a record 415 megawatt-hours. The Model 3 was the top-selling model with deliveries reaching a record 77,634.

Tesla CEO Elon Musk noted that Motor Trend just celebrated the Model S for its "cultural and vehicular impact", while the Model 3 was once again the best-selling premium vehicle in the U.S. That Tesla is significantly narrowing its losses is a good sign, though, especially when you consider that - prior to this quarter - the company struggled to actually deliver its vehicles to key markets like Europe and China.

Tesla said Model 3 deliveries reached an all-time record of 77,634, making it "the best-selling premium vehicle in the USA, outselling all of its gas-powered equivalents combined".

Musk then told investors during a conference call that Tesla should be "around break even" in its current quarter ending in September and expected to turn a profit during the final three months of the year.

Looking longer-term, though, Tesla is still confident that it can become fully profitable in the second half of the year, and that it can deliver between 360,000 and 400,000 vehicles by year's end. Next year, however, will start off rough - the first half will be challenging, but Musk said the second half of 2020 "will be incredible".

Tesla initially promised to be profitable in the third quarter of 2018 and has now pushed back that target multiple times. In the past, Tesla has included details on revenue and profits that didn't appear in its original announcements, such as cash received from selling clean-air credits to other automakers. Gigafactory Shanghai continues to take shape, and in Q2, Tesla started to move machinery into the facility for the first phase of production there. He said that while he is "not disappearing" he will step down from his executive position insisting, "I love the company and the team".

Overall revenues jumped 66 percent from a year earlier to $5.2 billion as Tesla reported sharply higher deliveries of its Model 3, the most affordable vehicle in its lineup and the hope for giving the company a wider customer base.

With all the talk of affordability and margins, no references were made to the more affordable, $25k, sub-Model 3 auto Musk had previously mentioned.

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