Tesla hits the accelerator, aims to build 500,000 cars a year by 2018

Tesla says it is expecting to hit its goal of producing 500,000 cars annually — including the Model S, Model X and Model 3 — two years earlier than expected, meeting that expectation by 2018.

All this is coming ahead of a critical next year for Tesla with the expansion of its line of vehicles with the Model 3 and updates to its Model S. Tesla also said it is re-affirming its plan to deliver 80,000 to 90,000 new vehicles this year. That means it’s going to have to have a roughly 5x increase in production capability in the next two years, a pretty ambitious target to hit given some of the troubles it’s had with its previous models. Still, given the number of reservations for the Model 3, that might not be too far out of reach.

The company made the announcement as part of its first-quarter earnings report, where it slightly beat analyst expectations and sent the stock up around 5 percent. Tesla said it expects to produce around 20,000 vehicles in the second quarter this year. The company said it has 325,000 reservations for the Model 3.

Tesla also said volume Model 3 production and deliveries will start late 2017.

Tesla’s past few months have been a mixed bag. The company unveiled its hotly anticipated Model 3 $35,000 car. It has a baseline distance of around 215 miles per charge, though Musk said the company hopes to exceed that. It’s probably Tesla’s most important launch yet, bringing the company’s vehicles down-market to a more affordable (sort of) price range.

At the same time, in April, the company said it would recall 2,700 Model X vehicles over concerns that its third-row seat could have issues. That’s not necessarily the only hiccup with the Model X, which also saw plenty of delays ahead of its launch. There were also reportedly other problems with the Model X that required repairs.

And to make things a little worse, Bloomberg reported that two top execs were leaving the company ahead of mass production of the Model 3. That news alone sent the stock down around 4 percent. The company’s stock has been overall pretty flat, down around 3 percent on the year.

Tesla’s jump today essentially reversed losses on the day following reports of executive departures. After the report, shares jumped as much as 7 percent before leveling off. Tesla beat what industry watchers were looking for in terms of the amount of money it made, posting a loss of 57 cents per share. Analysts were expecting a loss of 58 cents per share on revenue of $1.6 billion. Tesla brought in $1.6 billion in revenue, in line with what was expected for the company.

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