DETROIT (AP) — Tesla Inc.'s first attempt at high-volume production isn't going as well as it hoped.
The electric car maker's $35,000 Model 3 sedan is the vehicle that could move Tesla from a luxury niche automaker and into the mainstream. It introduced the Model 3 in July with a massive party at its Fremont, California factory.
Tesla CEO Elon Musk promised that the Model 3, which has more than 500,000 potential buyers on its waiting list, would be simpler to make than Tesla's previous vehicles and not plagued with the same delays. But the company produced just 220 Model 3s in the third quarter, far less than the 1,500 Musk promised.
And the problems will continue. Because of delays at its battery facility in Nevada, Tesla said it now expects to make 20,000 Model 3s per month by the end of the first quarter. Musk had initially set a target of December for that production.
"Tesla is learning what traditional automakers have long known — mass vehicle assembly is complicated and expensive," said Michelle Krebs, a senior analyst at Autotrader.com.
Tesla swung to a $619 million loss in the third quarter, mostly due to heavy spending to bring the Model 3 to market. The loss, of $3.70 per share, compared to a profit of 15 cents per share in the July-September period a year ago.
That was a far bigger decline than Wall Street had predicted. Analysts polled by FactSet forecast a loss of $2.85 per share.
Tesla had other significant expenses. The company opened 18 stores and service stations worldwide during the quarter, and set up 126 new Supercharger stations to try to prepare for the increase in demand from Model 3 buyers.
Sales of Tesla's two other vehicles — the Model S sedan and Model X SUV — rose 4.5 percent to 25,915. Tesla said net orders for those vehicles hit a record level in the third quarter, setting the stage for record deliveries in the fourth quarter. The company says it's on track to deliver 100,000 Model S and Model X vehicles in 2017, up 30 percent from 2016.
Tesla's revenue rose 30 percent to $2.9 billion for the quarter, in line with analysts' expectations. Tesla said installations for its energy storage business more than doubled from a year ago. Energy generation and storage accounted for 11 percent of Tesla's third quarter revenue.
Tesla's shares fell 3 percent to close at $321.08 Wednesday. They have risen 45 percent since the start of this year.
