Tesla reduces price of Model X, saying margins enhanced

Tesla Has Received 63000 Model 3 Cancellations

Tesla Has Received 63000 Model 3 Cancellations

Elon Musk, chief executive at Tesla is hoping the Model 3, which will become the most affordable of the Tesla vehicles when it hits the road at $35,000 for the baseline model, will become profitable and mass-marketable.

The company said Monday that it planned to offer senior notes due in 2025 and would use the offering's proceeds to further strengthen its balance sheet during rapid scaling of the Model 3.

Tesla Inc on Friday reduced the base price of its Model X SUV to $79,500 and stated enhancing margins lagged the move, which came as the automaker is increasing production of its new lower-priced Model 3.

Tesla ended the second quarter with a little more than $3 billion in cash, the lowest on hand in more than a year. Initial production of the new model started in July. "Tesla's a company that's always on to the next big innovation or the next big advancement and they raise money well in advance of when the public finds out about that".

In a sequence of posts on Twitter last week, Musk claimed that the Model 3 had passed all regulatory tests for manufacturing with flying colors 2 weeks ahead of time. Total debt at the end of the period was US$8.10bn.

Tesla's market cap surpassed giant automakers like Ford and General Motors earlier this year, despite its relatively tiny share of the auto market. The base $35,000 Model 3 will not be available until sometime in 2018.

The five drivers achieved the feat by using as little energy as possible by maintaining a constant speed, using low rolling-resistance tyres, not using air conditioning and trying not to apply the brakes.

"Those cancellations occurred over the course of more than a year", Musk revealed.

The company said last week that it already boasts 455,000 pre-orders for the car and is averaging 1,800 reservations a day since it launched late last month. The company just announced that it shipped 47,000 cars in the first half of 2017.

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