Musk promises manufacturing, self-driving, battery breakthroughs—and profits

Enlarge (credit: FilmMagic/FilmMagic for HBO)

On Tuesday, Tesla held its annual shareholder meeting. As expected, none of the controversial shareholder votes passed-there will be no independent CEO replacing Musk, and his brother and the other two candidates were reelected to the board with no drama or fireworks. Even Tesla's chief counsel Todd Maron referred to the opening agenda items as "the boring bits." Things got more interesting once Musk took to the stage for a Q&A session, answering queries submitted in advance via Twitter and then from the audience.

It was an odd performance, often feeling more like a Netflix comedy special than a shareholder meeting. Musk alternated between emotional states, at times rambling or hesitating. He began by stressing that "we're not perfect, but we pour our heart and soul into it... we really care." As expected, the Model 3 and its ongoing production problems dominated the Q&A, but Musk was also asked about Tesla's profitability, battery advances, new Gigafactories, Autopilot, and possible future Tesla vehicles. Musk even acknowledged that he has a problem with timescales-useful context for some of the predictions that we heard.

According to Musk, every part of the Model 3 production process has now demonstrated the ability to run at 500 cars/day, or 3,500 cars/week. As a result, Tesla should be profitable by Q3 2018 and generating positive cash flow by Q4 2018, we were told. And employee safety-the topic that caused Musk to start a feud with the press recently-is improving; the injury rate at the factory is now six percent below the industry average. But Musk complained that "it's tougher to achieve when you're building a new manufacturing line" and therefore Tesla's record shouldn't be judged alongside that of the traditional OEMs. He told the audience that Tesla's goal is to be at half the industry average, lamenting that it's impossible to completely eradicate accidents in a factory. Earlier that day, a lengthy investigation into repeated paint shop fires at Tesla was published by The Daily Beast.

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