Tesla Selling Stock to Finance Model 3, Updates Self-Park Feature's Safety
CARS.COM — As Tesla Motors closes in on 400,000 reservations for the new Model 3, the automaker will try to raise up to an estimated $1.7 billion through a stock offering. It said the proceeds will be used to ramp up for production of the more-affordable electric car, according to a filing Wednesday with the Securities and Exchange Commission.
Related: Reliability is $35,000 Question for Tesla Model 3
Tesla had about 385,000 reservations for the Model 3 as of May 15, but the California automaker said in its filing that customers have canceled some 8,000, while Tesla booted roughly 4,200 it believed to be duplicates from speculators. Still, that means about 97 percent of Tesla reservations — some 373,000 in total — still stand in the seven weeks since the car was unveiled. At a refundable $1,000 apiece, those orders give the automaker quite the influx of cash for the time being, given the Model 3 won’t go on sale until late next year.
“If we wanted to, we believe that we could further increase the number of Model 3 reservations with minimal effort, but [we] believe it is better to guide customers to purchase products currently in production,” Tesla wrote in its filings.
The automaker said it’s still on track to deliver the first Model 3 by late 2017. It had initially planned to build 500,000 cars by 2020 — including the Model S, Model X and Model 3 — but moved that target up to 2018 “because of the significant demand that we have seen.”
The filing said that in conjunction with the company offering of up to about 8.2 million shares, CEO Elon Musk will sell about 2.8 million of his personal shares to pay his taxes on stock options he will exercise.
In other news, Tesla has updated its Summon feature, which allows a car to park or un-park itself at low speeds via smartphone or a double-press on the parking stalk. Tesla said it updated the system to require another layer of confirmation after the latter action.
It comes in the wake of a fender (well, windshield) bender in Utah where a Model S reportedly crept, sans driver, into the back of a parked trailer. The owner, Jared Overton, told Salt Lake City’s KSL News that his car moved several minutes after he parked and stood beside it for at least 20 seconds. After reviewing the vehicle logs, Tesla reportedly said the car moved on its own because Overton had activated Summon on the parking stalk.
“This week we updated the feature to require physical confirmation of the direction of travel on the center display after double-press of the park stalk to ensure proper use,” a Tesla spokesperson told Cars.com. “And, to date, Summon has been safely and successfully used hundreds of thousands of times by customers.”
