(Reuters) – Tesla Motors (TSLA) plans to boost production of electric cars to “at least a few million a year” by 2025 from fewer than 40,000 last year, Chief Executive Officer Elon Musk said Tuesday.
Speaking at an industry conference in Detroit, Musk said Tesla may not be profitable until 2020. In addition, Tesla sales in China were unexpectedly weak in the fourth quarter. He blamed a misperception by city-dwelling Chinese consumers that they might have difficulty charging their electric cars.
Tesla shares fell 7 percent in after-hours trade to $190.22 from a close of $204.25 on the Nasdaq. During 2014, Tesla stock rose nearly 48 percent.
Musk, who last year said Tesla will begin phasing in “autopilot” features on its Model S sedan, predicted that the company will be first to market with a fully self-driving car, but likely not until after 2020. While Tesla may have a driverless car ready in five years, the vehicles may not receive regulatory approval for another two to three years after that, he said.
Musk also said the company’s long-delayed Model X sport utility vehicle will be launched this summer, while the lower-priced, higher-volume Model 3 is on track for a 2017 introduction.
The Model 3 will be critical to Tesla’s goal of reaching an annual sales level of 500,000 vehicles a year by 2020, a target which Musk also reaffirmed.
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If Tesla hits its target of a few million vehicles by 2025, it would put the company on par with Fiat Chrysler Automobiles , which sold 2 million vehicles last year in the United States.
Musk said Tesla likely would not achieve profitability using generally accepted accounting principles until the Model 3 ramps up to full production in 2020, although it may report non-GAAP profits before then as sales volume rises.
Musk told attendees at the Automotive News World Congress that “we could make money now if we weren’t investing” in new technology and vehicles such as the Model 3 and expanded retail networks, Musk said.
On another topic, Musk said he was open to partnerships with retailers to sell Tesla vehicles, but not until after the company no longer has production bottlenecks.
“Before considering taking on franchised dealers, we also have to establish (more of) our own stores,” he said. Musk said “we will consider” franchising “if we find the right partner.” He did not elaborate, but said Tesla “is not actively seeking any partnerships” with other manufacturers “because our focus is so heavily on improving our production” in Fremont.
Last year, Tesla delivered about 33,000 Model S sedans. Musk said the current wait for delivery is one to four months. Tesla already has presold every Model S that it plans to build in 2015, Musk said.
He said he did not see the Chevrolet Bolt, a low-priced electric car planned by General Motors Co for 2017, as a potential competitor to he Model 3.
But “I’d be pleased to see other manufacturers make electric cars,” he said.