After Tesla Inc (NASDAQ:TSLA) finally began delivering orders for its long-awaited Cybertruck overnight, following a highly anticipated launch event at its Austin Gigafactory, analysts said it could be longer than 18 months before the electric truck is cashflow positive.
Following the launch event, four years after boss Elon Musk first unveiled the design in somewhat chaotic fashion, 10 customers on the waiting list will receive the first models to roll off the production line.
Analysts at Wedbush estimated that the company will churn out 2,000 to 3,000 units this quarter, with a 10,000-units quarter in the first half of 2024 with pilot production capacity in Austin at 125,000 units.
The size of Cybertruck reservations and pre-orders has reportedly topped two million units.
Musk, who this time launched the angular EV with a series of videos showing off its tow power, speed, resistance to bullets and the same iron ball that smashed a window last time, confirmed that production now ramping up into the year-end and into 2024 but provided no delivery targets for the coming year.
Feat of Strength 1: Shots fired pic.twitter.com/aPfpQuMXvc
— Tesla (@Tesla) November 30, 2023
The main unknown was pricing and Tesla released three pricing options and models: all-wheel drive for $79.9k or $68.9k after tax credits and promotions, available for delivery in 2024; rear-wheel drive for $61k, available for delivery in 2025; and Cyberbeast for $100k, available for delivery in 2024.
To scale as quickly as possible, Wedbush noted that Tesla converted to building 100% Cybertruck cells to simplify and focus the Austin factory.
As the company ramps all four production lines over the next six to nine months it is estimated to hit its 250,000-per-year capacity sometime in 2025, analyst Dan Ives said.
Feat of Strength 2: Truck pull pic.twitter.com/senCV4YhTe
— Tesla (@Tesla) November 30, 2023
"The ramp of production for Cybertruck will be difficult and as discussed on the last conference call Musk & Co. are not expecting to be cash flow positive from this vehicle for another 12 to 18 months (could be longer in our view)," said Ives in a note to clients.
"Launching Cybertruck is important for the broader Tesla growth story over the coming years and also will prove to the doubters that Musk can successfully expand the Tesla halo effect as more consumers head down the EV path over the coming years."
He said the electric truck "does not significantly move the financial needle" for Tesla in next year, but shows how the company can innovate and emphasises the "mind share lead" Tesla has built over competitors around the world.
Wedbush has an 'outperfom' rating on Tesla stock and a $310 price target, which were reiterated.