Unit test fails using xctool - unable to identify bundle directory

I am having trouble running unit tests using command line xctool. I have Xcode-Beta 6.3 and command line tools installed. My project builds properly but fails to find the tests. I run the following command:

xctool -scheme AppTest -workspace App.xcworkspace -destination 'platform=OS X,arch=x86_64' test

My error message from running this is:

[Info] Collecting info for testables... (2708 ms)
run-test AppTest.xctest (macosx10.10, application-test)

Failed to query the list of test cases in the test bundle: Bundle '/Users /trondkr/Library/Developer/Xcode/DerivedData/App-fqafddzqqqjhxcdvsvtkdgjlopsa/Build/Products/Test/AppTest.xctest' does not identify an accessible bundle directory.

** TEST FAILED: 0 passed, 0 failed, 1 errored, 1 total ** (57002 ms)

When I run the tests within Xcode everything works fine and the tests are executed correctly (xctool also used to work properly with Xcode 5). Could anyone point me in the direction of what I am missing? I am sure I am missing adding something in build settings or something similar. I have searched for an answer to this problem on google and see many have similar problems but I cant find one solution that works for me. Thanks. Cheers, Trond