Tesla news: It raises $1.46B amid production boost; startup using Model 3 to lure workers

Tesla raised $1.46 billion in the stock sale it announced earlier this week, raking in fresh capital to help pay for its ambitious goal of producing 500,000 cars annually by 2018.

The shares were priced at $215, according to a prospectus supplement filed Thursday. The Palo Alto electric car maker offered about 6.5 million shares and CEO Elon Musk sold nearly 2.8 million shares.

Reuters notes that Tesla has raised $4.5 billion in debt and equity offerings in the past six years, when it raised $226 million in its June 2010 IPO. The company has gone back to the markets to raise capital “several times”; in August 2015 the company sold stock at a price of $242, raising $738 million.

Tesla is ramping up production amid unprecedented demand for its vehicles. It has 373,000 reservations for the Model 3, its cheapest car yet at $35,000, which it’s promising to start delivering late next year. The company has boosted its 2016 capital spending forecast to about $2.25 billion; it had about $1.44 billion in cash as of March 31.

Tesla shares are up about 1 percent to $217.50 today.

In related news, Reuters is reporting that some suppliers are skeptical about Tesla’s production goals, which Musk himself has referred to as “aggressive.”

Among the reasons analysts and supplier executives are raising doubts, according to Reuters: The design and specifications of the Model 3 sedan hasn’t been finalized, although Musk has said that will happen next month. Manufacturing consultants also told Reuters that assembly lines usually take up to 18 months to get up and running. Another car-industry watcher said the fact that Tesla’s Gigafactory battery facility in Nevada isn’t complete may prove to be a problem.

But it may not be the time to underestimate Musk.

“I’d be really surprised if he can launch production by next July,” Frank Faga, a Detroit-based auto manufacturing consultant, told Reuters. “But this is a guy who says he’s going to Mars. Who am I to say he can’t do this?”

And here’s your final Tesla item of the day: A startup in Raleigh, North Carolina is trying to lure talent with a Tesla. That’s right, scientific instruments maker Practichem is trying to add about 10 more people to its team of 15 by promising prospective employees Model 3s. The News & Observer says Practichem’s CEO figures the $35,000 cars will be cheaper than hiring a headhunter. But it doesn’t note whether the startup has already plunked down $1,000 reservations for the cars. If not, those “lucky” employees will probably have to wait awhile for their promised perks.

 

Photo: The Tesla factory complex in Fremont, Calif., on Thursday, Jan. 28, 2016. (LiPo Ching/Bay Area News Group)

 

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  • Slick Hillary

    Every Model S I’ve been in with over 50,000 miles has been a squeaky, rattling piece of garbage. You’d have to a be a fool to buy the first year production run of the 3. Then again, Tesla owners always vote for me — so I don’t care. In fact, I’m sure Elon will give me a few of them after I steer some Federal money and clearance for visas his way so he can drag as many Indians and Chinese over as he wants in order to pay them $5 an hour.

 
 
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