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Tesla experiences its biggest ever quarterly loss

November 1st, 2017  |  Canadian Business

Production on Tesla’s Model 3 sedan has been scaled back amidst production hiccups and the biggest quarterly loss the company has ever experienced. According to their latest quarterly earnings report, the automaker’s third quarter saw a $619 million loss.

The reported $619 million loss of sales, which was well below analysts expectations, resulted in a 5% drop in Tesla’s shares on Wednesday. Tesla posted a net loss of $619.4 million US, which equates to $3.70 per share, and is in contrast to the $21.9 million US (14 cents per share) of profit the year prior.

Tesla had plans to produce 5000 Model 3 sedans a week by the end of 2017, but the goal has now been pushed back by an estimated 3 months to early 2018.

“While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear,” the company said their quarterly earnings report.

The issues in production are being attributed to problems with the battery module assembly line, forcing Tesla to redesign part of its production process. The set backs have caused “production bottlenecks” which slowed Model 3 production down to only 260 during the third quarter, instead of their originally planned 1,500.