Tesla Inc shares boosted on Thursday before the expected release next week of the company’s quarterly auto production data, where as a senior executive prompted employees at the automaker to hit a weekly production target of 2,500 Model 3 sedans by the end of this month.
Quickly ramping up Model 3 production is important for the automaker. The company’s profitability depends on providing the new sedans to clients on a waiting list that Tesla has stated now numbers about 500,000 advance reservation holders.
Tesla shares recovered to $266.13, increase of 3 percent, Thursday after a sell-off prompted by a Moody’s debt downgrade and news that safety regulators are probing into a Model X-involved fatality.
In an email to workers read by Reuters, Tesla Senior Vice President of Engineering Doug Fields mentioned that production of Tesla vehicles is “well into the 200’s on every single line.”
Field gave reasons why the automaker needs to get to 2,500 vehicles on weekly basis, adding: “There are an incredible number of people who ‘short’ Tesla stock, which means they profit when we fail. And lately the story is the same: ‘Tesla can’t do high-volume production’. I find that personally insulting, and you should too. Let’s make them regret ever betting against us.”
Tesla should “quickly break through the 300 cars/day barrier, and keep going,” the email mentioned.
Tesla made no comments on the email, that was earlier reported by Bloomberg News.
Doubts that Tesla could meet its production targets and issues about cash reserves were behind Moody’s downgrade of Tesla earlier week. The ratings agency cited the likelihood of a new capital raise, which it estimated at more than $2 billion, in part to cover approximately $1.2 billion in convertible bonds coming due by March 2019.
The downgrade, in addition to a fatality involving a Model X that is presently being investigated by safety regulators, sent shares down 12 percent for the week, even after Thursday’s rebound. That made it Tesla’s worst week in last nine months.
Tesla shares are still above the $255.73 level, the cost when Tesla last announced a capital raise in March 2017 to raise $1.15 billion.