After receiving more than 350,000 pre-orders for its Model 3 sedan, Tesla Motors is planning to boost its annual production capacity to 500,000 vehicles by 2018. This is 10 times higher than the 50,000 cars Tesla delivered in 2015. To raise funds for this huge capacity expansion, the company plans to sell about $1.4 billion in stock, which would dilute the return of existing shareholders to some extent. Tesla received a better than expected response to its Model 3 sedan which was promoted as the electric vehicle for “masses” priced at $35,000 and the next challenge for the company is to increase production capacity to deliver these orders. The company has also roped in Audi’s Peter Hochholdinger who will join Tesla’s vehicle production division and work towards streamlining and improving current production and develop a manufacturing plan to meet the ambitious production goal. According to our estimates, Model 3 is the most valuable segment for Tesla and while the company has generated enough demand for this vehicle, meeting production targets will be key for Tesla’s valuation.

from Forbes – Tech http://ift.tt/27Iqhpw
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