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Read Tesla CEO Elon Musk's latest email urging employees to improve vehicle deliveries

Key Points
  • On Wednesday, a new email from Tesla CEO Elon Musk to all employees asked them to focus on making end-of-quarter deliveries better than they have been, historically.
  • Tesla CFO Zach Kirkhorn told investors in Q1 that "unwinding the wave" of uneven deliveries would be critical in getting Tesla to profitability later this year. 
Elon Musk
Jim Watson | AFP | Getty Images

On Wednesday, a new email from Tesla CEO Elon Musk to all employees at the electric car company called for employees to focus on making end-of-quarter deliveries better than they have been, historically.

As he did in recent weeks, Musk hammered home the notion that every employee should be individually focused on controlling costs.

In this installment, Musk reminds Tesla employees that the company's first quarter results fell short of investors' expectations, in part because Tesla was unable to make deliveries efficiently and on time.

Sales of Tesla's electric vehicles hit $3.72 billion in the first quarter which represented a 41% drop from the fourth quarter of 2018, when the company generated $6.32 billion in automotive revenue. In its first quarter vehicle deliveries and production report, Tesla said it delivered 63,000 vehicles during that quarter, down from a record 90,700 in the fourth quarter of 2018.

The company has given guidance that it will deliver around 90,000 vehicles in the second quarter, and between 360,000 and 400,000 for the year.

Tesla's relatively new CFO Zack Kirkhorn told investors on its first-quarter earnings call this year that "unwinding the wave" of uneven deliveries would be critical in helping Tesla achieve profitability later this year.

Here's the Musk's e-mail about deliveries from Wednesday.

To: Everybody

From: Elon Musk

Date: May 29, 2019

While our demand is strong, we have a lot of vehicle deliveries to catch up to in order to have a successful quarter.

Starting tomorrow, I will be holding skip-level calls with the America, Asia and Europe delivery teams every 2 days to understand what's needed to accelerate our rate of deliveries.

We also need to address the total cost of getting a car from our factory to the customer. Last quarter, there were many expedite fees and routing inefficiencies that led to higher than expected delivery costs. This makes it much harder for Tesla to break even.

Per my earlier email, if we execute well, Q2 will be an all-time record for Tesla vehicle deliveries and an awesome victory!

Super excited to make this happen with you!

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