January 14, 2015
If you prefer to buy low, it could be a great time to grab some stock in Tesla Motors.
The Huffington Post reported today that Tesla Motors‘ stock plummeted nearly 7 percent on Wednesday after CEO Elon Musk disclosed that the electric car maker “won’t turn a profit for another five years”. In fact, Musk reportedly claims that Telsa likely won’t be bringing in a profit until 2020.
The share price was on track to close at the lowest since May, ringing in around $178. As the saying goes though you have to spend money to make money, and Musk has been doing just that.
“We’re spending a lot of money,” Huffington Post quotes Musk. “But if we were to just scale back our growth and just go for moderate increases in, say, the Model S customer base, we’d be profitable by any measure.”
Recently we reported that Tesla was planning to open a factory in Nevada where they plan to mass produce lithium-ion batteries that power the Model S automobile. Tesla is also looking to release the Model X, a SUV, in the next few years.
It’s my belief, though, that Tesla won’t start turning major profits until they release the long-awaited $35,000 sedan. After all, the majority of car-buyers in the US can’t shell out $70,000 and up for a new Model S.
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