If there was any question that the financial performance of Tesla's all electric Model S could match its gusto on the racetrack - today is a good day for the automaker, despite challenging market conditions. Tesla just announced that vehicle sales have exceeded targets issued in a shareholder letter last month.
Vehicle sales have now exceeded 4,750 units vs. the 4,500 unit prior outlook, the company says (it probably also was very conservative with its projections). Tesla has consequently revised its Q1 guidance for profitability on both GAAP and non-GAAP filings with the SEC. Q1 is a momentous quarter for Tesla: it anticipates that it will become profitable for the first time in its history. That's a pretty big milestone for the EV industry too.
The popularity of the Model S is significant as other EV makers including Coda and Fisker automotive have hit troubled times. That's something that Tesla Motors co-founder and CEO Elon Musk touched on in a statement: "I am incredibly proud of the Tesla team for their outstanding work. There have been many car startups over the past several decades, but profitability is what makes a company real. Tesla is here to stay and keep fighting for the electric car revolution. I would also like to thank our customers for their passionate support of the company and the car. Without them, we would not be here."
There was one caveat in today's announcement. Sales for the Model S's shorter range small battery option were poor, so that edition will not be produced. Customers will receive a software restricted battery that will be upgradable to full capacity for the current or future owner. Tesla acknowledged that the market had spoken.
Tesla's position in the market appears to be stable. Earlier this month, the company said that it intends to pay back U.S. government loans on an accelerated schedule. Tesla received US$465 million from the U.S. Energy Department to fund the development and creation of its EV designs, which are now hitting the market.