Tesla produced a record 80,142 vehicles in the three months through September, including over 53,000 of its mass-market electric car, soothing investors concerned that founder Elon Musk's recent controversies would distract the automaker from its performance targets.
Of the over 83,000 vehicles delivered in the quarter, the company shipped 55,840 of its Model 3s — double the amount delivered in all the prior quarters combined, Tesla said in a statement. The shipments were limited to "higher-priced variants, cash/loan transactions, and North American customers."
"There remain significant opportunities to grow the addressable market for Model 3 by introducing leasing, standard battery and other lower-priced variants of the car, and by starting international deliveries," Tesla said.
Deliveries of its mid-size Model S and crossover Model X also grew despite the ongoing trade dispute between the U.S. and China. President Trump has imposed tariffs on steel and aluminum imports, as well as duties on $250 billion worth of Chinese products, and Beijing has retaliated in kind. Imports of Tesla vehicles into China faced a 40 percent levy, while other imported cars were subject to a 15 percent tax, the company said.
"Taking ocean transport costs and import tariffs into account, Tesla is now operating at a 55 percent to 60 percent cost disadvantage compared to the exact same car locally produced in China," Tesla said. "This makes for a challenging competitive environment, given that China is by far the largest market for electric vehicles."
The Palo Alto, Calif.-based company said it will accelerate construction of its facility in Shanghai, where it expects a "rapid buildout."
Despite hitting production targets, Tesla's stock dropped 1.66 percent to $305.54 in New York trading.
Tesla has grappled for months with production issues related to the Model 3 as well as pressure to begin turning a profit. Lately, however, the attention has shifted to Musk and his personal antics. The 47-year old entrepreneur drew criticism last month when he smoked pot on a popular U.S. podcast and is facing a defamation suit for calling a British diver involved in the rescue of a Thai soccer team a pedophile.
But it was Musk's August tweet that he had secured funding to take Tesla private at a valuation of $420 per share that caused the most trouble. The Securities and Exchange Commission brought a civil fraud suit against Musk on Friday and sought to ban him from serving as an officer or director at any public company; he agreed to settle a day later.
Both Tesla and Musk paid $20 million fines and Musk was forced to relinquish his role as chairman of the automaker's board. He can remain as chief executive officer, a move that analysts said was critical to ensuring continued funding since investors view him as a creative visionary. The Department of Justice is also investigating the company.