Tesla's Jerome Guillen thanked the company's production team for making a 20% jump in deliveries possible. Photo credit: Len Katz.
Tesla is the little electric engine than could. No matter what obstacle is placed in front of the company, it continues to plug along and it appears its determination will be rewarded with fourth quarter revenues expecting to exceed guidance by 20%.
In a letter to shareholders discussing the company’s third quarter results, Tesla indicated it expected fourth-quarter earnings to be “about consistent” with the third quarter.
Of course even that’s tough to determine as the maker reported earnings of $16 million, but if generally accepted accounting principles (GAAP) are applied, it lost $38 million.
Regardless, the fourth-quarter prediction was a surprise to analysts who had been anticipating an increase as production and sales of the Model S battery-car continue to grow.
The analysts were correct as the EV maker’s sales during the quarter were the highest in company history. It delivered nearly 6,900 Model S sedans, which was 20% higher than predicted.
Jerome Guillen, vice president, Worldwide Sales & Service, thanked the company’s production team during the North American International Auto Show, as well as key suppliers, in particular Panasonic.
(Tesla exec gets testy about possible recall. For more, Click Here.)
The sales increase comes during a time where the Palo Alto, Calif.-based company is dealing with an investigation by the National Highway Traffic Safety Administration (NHTSA) into three Model S vehicle that occurred when the compartment housing the battery was compromised.
(Click Here to see that sales of plug-in vehicles doubled in 2013.)
Guillen took advantage of the world stage provided by the North American International Auto Show to remind people that the Model S holds a five-star safety rating from NHTSA and no one has ever been killed or suffered a serious injury while driving or riding as a passenger in a Model S.
He went on to note the company has already made safety improvements to the Model S through a firmware update sent to each vehicle.
I’ve suspected for quite some time that Tesla might be using some creatine accounting practices and with claims of $16 million in earnings that equal a $38 million loss by GAAP standards, it would appear that my gut feeling was right.
Now with a NHTSA fire investigation and recent news that the charging systems can cause electrical fires in home wiring, Tesla has a lot more issues than it would like the public to know.
If stock holders lose their shirts with a sudden price drop there will be lawsuits and more investigations, which might be inevitable with a $54 million difference in quarterly accounting figures.
Are we seeing a repeat of the old Roger Smith-era accounting at GM, where the maker repeatedly announced how much better it was doing…right up to its near-bankruptcy crisis in 1992?
Paul E.