Shares of Tesla Motors fell a shocking plus-5 percent Wednesday after CEO Elon Musk told a crowd in Detroit that he doesn’t expect the company to become profitable until 2020.
The stock price hit a low of $185 for the day before closing at $192.69, or 5.66 percent lower than that day’s opening price, and the lowest since it hit roughly $178 in May. (RELATED: Tesla Shares Tumble With Gas Prices)
Wednesday’s closing price marks the low point of an eight-month downtrend since Tesla’s all-time high of $290.50 in the latter half of 2014.
“We’re spending a lot of money,” Musk said during a press conference at the Automotive News World Congress Tuesday. “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.”
The company is currently in the midst of preparing its third production model, the X SUV, for release in the latter half of the year, but Musk doesn’t expect profitability until the company starts selling its forthcoming Model 3, which he said Wednesday will retail for $35,000 before potential state and federal tax incentives.
“I expect we’ll achieve profitability in 2020,” Musk said.
He later added that despite the pushback in profitability projections, the company exceeded its target sales goal of 33,000 vehicles last year.
“We sold, in terms of cars, far more than that,” Musk explained. (RELATED: Tesla Expected To Miss Sales Forecasts Because Of Its Weird New Doors)
The leading-electric entrepreneur also took the time to reveal some quirky company secrets, including the last-minute Model S production change he made prior to rollout in 2012 after one of his kids called it “the stupidest car in the world.”
After initially pulling the car’s rear interior reading lights to increase headroom, Musk had them put back in after the cars began shipping, and offered them as a free install later to customers who missed out. The justification was that most readers would be using backlit devices, but engineers figured out a way to install them without the headroom decrease.
Musk went on to give his thoughts about some of his alternative-energy rivals showing their wares across town at the North American International Auto Show, where both Toyota and Honda had their latest in hydrogen fuel vehicles on display.
“It has extremely low density, it’s invisible, you can’t even tell if it’s leaking, it’s extremely flammable,” Musk said “Hydrogen is an extremely dumb [alternative fuel] to pick. You might as well pick methane.”