Tesla To Sell $2 Billion In Stock | Alternative Energy | Forums

Not sure if this is a good sign

Electric automaker Tesla (TSLA) said late Wednesday that it will make a $2 billion secondary stock offering to fund its ambitious production schedule. Meanwhile, Tesla also said it has 373,000 Model 3 orders after cancelling about 12,000 reservations.

“Because of the overwhelming demand that it has received for Model 3, Tesla intends to use the net proceeds from this offering to accelerate the ramp of Model 3,” said Tesla’s press release. “As noted in the company’s first-quarter shareholder letter, Tesla intends to start volume production and deliveries of Model 3 in late 2017 and to accelerate its 500,000 unit build plan from 2020 to 2018.”

The company said $1.4 billion worth of stock will be sold by Tesla for this purpose. The remaining $600 million will be raised by CEO Elon Musk, who is exercising his option to acquire 5.5 million Tesla shares and will use the sale to cover his tax bill, the company said. He’s also donating 1.2 million shares to charity.

Tesla said it had some 373,000 orders for the entry-level luxury Model 3 as of May 15. That’s after customers cancelled about 8,000 orders and the automaker cut some 4,200 orders that were likely duplicates. Tesla had said previously that it had about 400,000 orders.

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