Beautiful Virgin Islands

Friday, Jan 23, 2026

Tesla’s growth ambition comes with a $175 billion price tag

Tesla’s growth ambition comes with a $175 billion price tag

CEO Elon Musk sees infinite demand for Teslas, provides little insight into next-generation vehicle

Elon Musk’s Tesla Inc. spent around $28 billion to cement itself as the world’s most valuable car company. It is now preparing to invest roughly five times that as it strives to meet the next objective: Becoming the world’s largest car maker by volume.

Chief Financial Officer Zach Kirkhorn said publicly for the first time on Wednesday that Tesla could need to spend nearly $150 billion more to achieve its long-term goals, which includes selling 20 million vehicles a year. Today’s largest auto maker sells roughly half that annually, while Tesla delivered around 1.3 million vehicles to customers globally last year.

Tesla leadership, in their presentation to investors gathered at the company’s Austin-area factory, spoke to both the scale of the company’s ambitions and how they had overcome hurdles, including reducing manufacturing costs. What stood out, as much as anything, was what they didn’t talk about in detail: a new vehicle.

A man wearing a face mask following the coronavirus disease (1COVID1-19) outbreak walks by Tesla Model 3 sedans and Tesla Model X sport utility vehicle at a new Tesla showroom in Shanghai, China May 8, 2020. 


Tesla hinted at coming models, displaying a slide with two vehicles cloaked in sheets, without sharing specifics. Wall Street had been clamoring for details on when Tesla might introduce a new, less expensive car that would expand its reach.

Wells Fargo analysts called it disappointing that "there was no reveal, timeline, or even basic product description of the next gen model."

The company currently offers four-passenger vehicles, with a fifth—the Cybertruck pickup—slated to hit the market later this year. The least expensive of those offerings is priced at more than $40,000 in the U.S.

Tesla co-founder and CEO Elon Musk stands in front of the newly unveiled all-electric battery-powered Tesla's Cybertruck at Tesla Design Center in Hawthorne, California on November 21, 2019.


It would be jumping the gun, Mr. Musk said, to discuss a coming vehicle, saying the company would have a separate product event. However, he and others underscored the importance of affordability.

Any new, more affordable model is unlikely to contribute meaningfully to Tesla’s sales until 2025 at the earliest, Bernstein Research analyst Toni Sacconaghi Jr. said in a note to investors. In the meantime, he said, Tesla will need to lower prices to hit its growth targets.

Tesla shares slumped more than 6% in Thursday trading.

Tesla Gigafactory Texas on Jan. 17


Mr. Musk, the chief executive, confirmed plans to build a new factory in Mexico while expanding the company’s existing plants. Tesla currently makes vehicles in the U.S., China and Germany. Mr. Musk has said the company is likely to need roughly a dozen factories to meet its long-term sales goal.

California Gov. Gavin Newsom and Tesla CEO Elon Musk announced the location of the company’s new global engineering headquarters. The facility will be in the former computer-maker Hewlett Packard building in Palo Alto. Photo: Tesla

Tesla will build its next-generation vehicle in Mexico and elsewhere, the company indicated.

Mr. Kirkhorn, the CFO, said his investment forecast of up to $175 billion, including around $28 billion already spent, was intended to illustrate the feasibility of Tesla’s goals.

German Chancellor Olaf Scholz, left, talks to Elon Musk, Tesla CEO, at the opening of the Tesla factory Berlin Brandenburg in Gruenheide, Germany, Tuesday, March 22, 2022. The first European factory in Gruenheide, designed for 500,000 vehicles per ye



"We may choose to vertically integrate more into things. We may find efficiencies elsewhere," he said.

Meanwhile, Tesla is getting into the business of making the materials needed to produce the battery cells that power its electric vehicles. It broke ground on a lithium refinery near Corpus Christi, Texas, and is building a battery materials facility in the Austin area, said Drew Baglino, the company’s senior vice president of powertrain and energy engineering.

"We are also trying to accelerate the pace of the industry by trying some new things that are a little bit more scalable and de-risking certain innovations that improve productivity," Mr. Baglino said.


Tesla is expanding from a position of relative financial strength. The company has weathered periods of extreme financial strain, narrowly avoiding bankruptcy in 2008 and again roughly a decade later as it struggled to ramp up production of the Model 3 sedan, Mr. Musk has said. Now, Tesla is sitting on a war chest of around $22 billion in cash and short-term investments.

The company, which has reported 14 profitable quarters in a row, slashed vehicle prices earlier this year—some by nearly 20% in the U.S.—amid concerns about sagging demand. It has since nudged some prices back up. Tesla found that "even small changes in the price have a big effect on demand, very big," Mr. Musk said.

He again dismissed the notion that Tesla could struggle to find buyers. "Demand for our vehicles, in terms of desire to own them, may as well be infinite," he said.

Unleashing that demand will require cost reductions, though, Tesla powertrain engineering leader Colin Campbell said. "If we want to make EVs more accessible to people, they have to be cheaper," he said. "We can make lower cost products that are still efficient and compelling and we can make them at scale."

Shanghai, China - August 1, 2020: Exterior view of automobile plant Tesla Gigafactory 3 located in Pudong District, Shanghai, China.


Scaling up manufacturing hasn’t always been easy for Tesla. The company faced "production hell" in the early days of making the Model 3. At one point last year, Mr. Musk called the company’s new factories in Germany and Texas "gigantic money furnaces." It has taken Tesla two decades to produce four million vehicles.

On Wednesday, Mr. Musk reflected on the challenge ahead.

"The hard part is building the cars and the entire supply chain that goes with the cars. This is a logistics challenge of extraordinary difficulty," he said.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Trump Reverses Course and Criticises UK-Mauritius Chagos Islands Agreement
Elizabeth Hurley Tells UK Court of ‘Brutal’ Invasion of Privacy in Phone Hacking Case
UK Bond Yields Climb as Report Fuels Speculation Over Andy Burnham’s Return to Parliament
Prince William to Make Official Visit to Saudi Arabia in February
Prince Harry Breaks Down in London Court, Says UK Tabloids Have Made Meghan Markle’s Life ‘Absolute Misery’
Malin + Goetz UK Business Enters Administration, All Stores Close
EU and UK Reject Trump’s Greenland-Linked Tariff Threats and Pledge Unified Response
UK Deepfake Crackdown Puts Intense Pressure on Musk’s Grok AI After Surge in Non-Consensual Explicit Images
Prince Harry Becomes Emotional in London Court, Invokes Memory of Princess Diana in Testimony Against UK Tabloids
UK Inflation Rises Unexpectedly but Interest Rate Cuts Still Seen as Likely
Starmer Steps Back from Trump’s ‘Board of Peace’ Amid Strained US–UK Relations
Prince Harry’s Lawyer Tells UK Court Daily Mail Was Complicit in Unlawful Privacy Invasions
UK Government Approves China’s ‘Mega Embassy’ in London Amid Debate Over Security and Diplomacy
Trump Cites UK’s Chagos Islands Sovereignty Shift as Justification for Pursuing Greenland Acquisition
UK Government Weighs Australia-Style Social Media Ban for Under-Sixteens Amid Rising Concern Over Online Harm
Trump Aides Say U.S. Has Discussed Offering Asylum to British Jews Amid Growing Antisemitism Concerns
UK Seeks Diplomatic De-escalation with Trump Over Greenland Tariff Threat
Prince Harry Returns to London as High Court Trial Begins Over Alleged Illegal Tabloid Snooping
High-Speed Train Collision in Southern Spain Kills at Least Twenty-One and Injures Scores
Meghan Markle May Return to the U.K. This Summer as Security Review Advances
Trump’s Greenland Tariff Threat Sparks EU Response and Risks Deep Transatlantic Rift
Prince Harry’s High Court Battle With Daily Mail Publisher Begins in London
Trump’s Tariff Escalation Presents Complex Challenges for the UK Economy
UK Prime Minister Starmer Rebukes Trump’s Greenland Tariff Strategy as Transatlantic Tensions Rise
Prince Harry’s Last Press Case in UK Court Signals Potential Turning Point in Media and Royal Relations
OpenAI to Begin Advertising in ChatGPT in Strategic Shift to New Revenue Model
GDP Growth Remains the Most Telling Barometer of Britain’s Economic Health
Prince William and Kate Middleton Stay Away as Prince Harry Visits London Amid Lingering Rift
Britain Braces for Colder Weather and Snow Risk as Temperatures Set to Plunge
Mass Protests Erupt as UK Nears Decision on China’s ‘Mega Embassy’ in London
Prince Harry to Return to UK to Testify in High-Profile Media Trial Against Associated Newspapers
Keir Starmer Rejects Trump’s Greenland Tariff Threat as ‘Completely Wrong’
Trump to hit Europe with 10% tariffs until Greenland deal is agreed
Prince Harry Returns to UK High Court as Final Privacy Trial Against Daily Mail Publisher Begins
Britain Confronts a Billion-Pound Wind Energy Paradox Amid Grid Constraints
The graduate 'jobpocalypse': Entry-level jobs are not shrinking. They are disappearing.
Cybercrime, Inc.: When Crime Becomes an Economy. How the World Accidentally Built a Twenty-Trillion-Dollar Criminal Economy
The Return of the Hands: Why the AI Age Is Rewriting the Meaning of “Real Work”
UK PM Kier Scammer Ridicules Tories With "Kamasutra"
Strategic Restraint, Credible Force, and the Discipline of Power
United Kingdom and Norway Endorse NATO’s ‘Arctic Sentry’ Mission Including Greenland
Woman Claiming to Be Freddie Mercury’s Secret Daughter Dies at Forty-Eight After Rare Cancer Battle
UK Launches First-Ever ‘Town of Culture’ Competition to Celebrate Local Stories and Boost Communities
Planned Sale of Shell and Exxon’s UK Gas Assets to Viaro Energy Collapses Amid Regulatory and Market Hurdles
UK Intensifies Arctic Security Engagement as Trump’s Greenland Rhetoric Fuels Allied Concern
Meghan Markle Could Return to the UK for the First Time in Nearly Four Years If Security Is Secured
Meghan Markle Likely to Return to UK Only if Harry Secures Official Security Cover
UAE Restricts Funding for Emiratis to Study in UK Amid Fears Over Muslim Brotherhood Influence
EU Seeks ‘Farage Clause’ in Brexit Reset Talks to Safeguard Long-Term Agreement Stability
Starmer’s Push to Rally Support for Action Against Elon Musk’s X Faces Setback as Canada Shuns Ban
×