The last quarter was not the best period for Tesla Motors Inc (NASDAQ:TSLA) and its CEO after the company lost over 28 percent of its share value since September 2014. After a remark from the CEO concerning the falling sales in China and the profitability deferred to 2020, the electric carmaker lost over 5 percent in the regular hour trading closing at $192.69.
It was the biggest single-day drop for Tesla since October 27 and what took investors by surprise was Musk’s remark according to which, the company would become profitable only after 2020 provided its annual car sales reach 500,000. While discussing the profitability of Tesla Motors Inc (NASDAQ:TSLA), Musk said that the company is not looking for short-term profits and it is investing in new models for long-term growth. He further added that the electric carmaker would manufacture few million cars annually by 2025.
At the same time, Musk showed his concern over dropping sales in China citing the market as its wild card option that changes for reasons beyond their understanding. Despite of the small market for EVs in China, the major concern is that these dropped sales are not being covered in North America or European markets.
Falling sales in China should not be the only concern of Tesla Motors Inc (NASDAQ:TSLA) as its bigger counterpart, General Motors Inc (NYSE:GM) is all set to launch a new generation Chevrolet Bolt EV for $30,000 after government incentives. The car comes with an extended battery and runs up to 200 miles per charge. It could pose substantial competition for the upcoming lower-cost Model III from Tesla, which is likely to cost $35,000 and will debut in the market in 2017.
Tesla Motors Inc (NASDAQ:TSLA) would release its latest sales figure in February’s quarterly result announcement. The electric carmaker has current market cap of $25.65 billion.
This article has been written by Prakash Pandey.