Tesla Delays Model 3 Goals After Record Cash Burn

Tesla Inc. delayed a target for its critical Model 3 sedan as production setbacks at its battery gigafacatory contributed to record cash burn by Elon Musk’s electric-car maker.

The company now expects to make about 5,000 of the cars per week by late in the first quarter of 2018, rather than by the end of this year, the chief executive officer wrote in a letter to shareholders Wednesday. The main constraint holding back output is on the badembly line that packages battery cells at Tesla’s gigafactory near Reno, Nevada.

Tesla shares dropped 4.1 percent to $307.80 as of 4:54 p.m. in New York, after the close of regular trading.

“While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear,” Musk and Chief Financial Officer Deepak Ahuja wrote in the investor letter.