Tesla said on Monday (Oct 23) its capital expenditure for 2023 would exceed the US$7 billion to US$9 billion target it had laid out earlier this year, as the electric vehicle maker ramps up output at its factories and gears up to roll out new models.
The automaker is expected to start shipments of its revamped Model 3 compact sedan and the “Blade Runner”-inspired Cybertruck in the last three months of the year, after factory retooling in the third quarter that sapped deliveries and ate into earnings.
The company’s spending is, however, expected to return to the US$7 billion and US$9 billion range in the next two years, a regulatory filing showed.
Tesla was hesitating on its plans for a factory in Mexico as it grapples with a turbulent economic outlook, CEO Elon Musk said in an earnings call earlier this month.
He warned that rising interest rates could impact demand at Tesla, on top of a margin-sapping price war this year to maintain sales.
In a post on the X social media platform on Monday, Musk said Tesla was advertising on a “small scale and will do so at a larger scale as we figure what works best”.
He opened the door to ads earlier this year, in an about-face for Tesla that had for years shunned advertising and banked on Musk’s star power and customer enthusiasm for its vehicles.
Tesla shareholders – including Gary Black, managing partner of The Future Fund, which owns Tesla stock – have been calling for the automaker to advertise, saying that price cuts have only had a limited impact on demand.
Tesla’s shares were down nearly 1 per cent in premarket trading in a broadly weaker market.