Billionaire Elon Musk denies Tesla will need to raise money this year as he holds fast on profit pledge

 
Rebecca Smith
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Musk says Tesla will soon turn a profit (Source: Getty)

Tesla boss Elon Musk has denied the electric car giant will need to raise cash this year, after a comment from investment bank Jefferies.

Jefferies had predicted Tesla will need $2.5bn to $3bn this year, while last month credit ratings agency Moody's downgraded Tesla's debt, saying the firm "will likely need to raise additional capital during the second half of 2019".

Today, Musk took to Twitter to respond to a report by the Economist quoting Jefferies' prediction that his car company will need to raise capital this year.

Read more: Tesla's Elon Musk calls Model 3 delays a "time shift" of up to nine months

"Tesla will be profitable and cash flow in Q3 and Q4, so obv no need to raise money," he tweeted.

Earlier this month, Tesla released a statement saying it had no need to raise more capital this year, and had been "laying the groundwork for Q3 to have the long-sought ideal combination of high volume, good gross margin and strong positive operating cash flow".

"As a result, Tesla does not require an equity or debt raise this year, apart from standard credit lines," Tesla said in its statement.

The firm has been facing a production time squeeze on its more affordable Model 3s, and missed its target for 2,500 vehicles being made each week by the end of the first quarter. In the last week of the quarter it did announce a ramp up, with 2,200 built, and has stuck to its target of producing 5,000 Model 3 sedans per week in three months.

Success of the Model 3 production is viewed as crucial as it has been billed as a more affordable electric car, and leading Tesla into becoming a mass producer to fend off the rising wave of firms looking to get in on the electric vehicle market.

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