The mass-market Tesla Model 3 sedan is on track for its volume production by September, Tesla chief executive officer Elon Musk confirmed on Wednesday. Many market analysts said that this assurance coming from Musk is sure to entice investors to view the electric vehicle industry as a major avenue for the fledgling company.
Despite these positive developments, Musk said that operations are still burning a huge hole in the company's resources. There is a big possibility that Musk will turn to Wall Street investors for more cash, especially now that the hype for the Tesla Model 3 is at its top level.
on track for initial production in July, volume production in September
— Tesla Model 3 News (@TeslaModel3News)
"According to our financial plan, no capital needs to be raised for the Model 3 but we get very close to the edge, Musk told investors on a conference call in a statement acquired by . "We're considering a number of options but I think it probably makes sense to raise capital to reduce risks."
The company estimates that it will burn an additional $2 billion to $2.5 billion in capital expenses before the first Tesla Model 3 rolls out. The company added that it has $3.4 billion cash on hand.
In terms of production, Tesla is confident that it will meet demands. Many analysts have predicted that the Tesla Model 3 volume production will be delayed until the early months of 2018. A prediction that Tesla contradicted as the company is positive that it can produce more than 5,000 units of Model 3 within a week when full production kicks into high-gear during the fourth quarter of this year, according to .
Musk is standing by its work that Tesla can deliver 500,000 car units in 2018, and hit its 1 millionth vehicle by 2020. The company did not provide an actual target production for the Tesla Model 3, although there are speculations last year that sedan has received 373,000 advance reservations.