CEO of the electric-car manufacturer, Tesla, Elon Musk, recently confirmed that the company barely survived ramping up production of its Model 3 vehicle in the years between 2017 and 2019.
Musk explained that at one point, Tesla was just one month from bankruptcy. The problems occurred during the period when Tesla was working towards mass production of the Model 3.
The CEO further revealed that the Model 3 was slow to come off production lines. During that time, Tesla struggled to make money by selling the cheap vehicle at $35,000, which led to the company finding it hard to string together successive profitable quarters. Several investors of Tesla were left worried about the company’s progress. Musk described the process as "production and logistics hell".
Musk added that, in 2008, Tesla was also only three days from bankruptcy. However, the company was saved by a $40 million contribution which came through on Christmas Eve on the "last hour of [the] last day possible." The $40 million funding gave Tesla a runway until June of 2019. According to the founder, it was "extremely difficult" to raise the needed funds for an electric car startup in that same year. Back then, Musk invested all his money into the business "even though I thought we would still fail," and after the company had to lay off 18% of its workforce.
In a post on his Twitter account, Musk added that he didn't own a house at the time, and had to borrow money from friends to pay rent, "But, it was either that or certain death for Tesla".
The company was also kept afloat by an investment of $50 million from the Daimler company, which is also known as Mercedes-Benz. However, the funding came in exchange for nearly 10% of Tesla's stock in 2009.
However, after some rocky paths, Tesla is now one of the biggest companies in the world. Tesla also posted its most profitable quarter ever on October 21 of this year, which blew past analyst estimates.
Find out in the Torque News YouTube video below.