What happened

Shares of Tesla (TSLA 1.50%) jumped on Wednesday, rising as much as 7.8%. By the end of the trading day, the stock was up 7.3%, extending momentum from Tuesday, when it surged about 6%.

Optimism from the stock on Wednesday likely reflects the same catalyst that sent shares higher on Tuesday: The automaker said Model 3 production had accelerated to a rate of about 2,000 units per week. In addition, Tesla said the Model 3's rapidly rising production meant the electric-car company wouldn't need to raise capital this year.

Tesla's vehicle production line at its factory in Fremont, California

Tesla factory. Image source: Author.

So what

After initially aiming to end 2017 at a production rate for Model 3 of 5,000 units per week, the company has delayed its production targets for the important vehicle twice. After the first delay, Tesla was aiming to achieve a production rate of 5,000 Model 3 units per week by the end of Q1. Then it said in its Jan. 3 press release for fourth-quarter vehicle deliveries that it shifted its production targets to 2,500 units per week by the end of Q1 and 5,000 units per week by the end of Q2.

Though Tesla came up short of its target of ending Q1 at a production rate of 2,500 units per week, the company's progress is significant enough to encourage investors.

Now what

Looking ahead, Tesla still believes it can hit a production rate of 5,000 Model 3s per week in about three months. But investors should remain skeptical about this ambitious forecast considering the automaker's six-month delay from its initial targets and the fact that it didn't quite hit its target for 2,500 units per week.