Luxury electric vehicle maker Tesla Inc (TSLA) said on Wednesday that it reached an all-time best quarter for combined deliveries of its flagship Model S and X vehicle. In addition, the company revealed that it delivered 1,550 of its mass market Model 3 compact sedan in the fourth quarter, a big increase from the 220 units delivered in the previous quarter. Deliveries rose 27% in the fourth quarter from the prior-year period, and 9% over Q3 2017.
Tesla delivered a total of 29,870 vehicles in Q4, of which 15,200 were Model S, 13,120 were Model X, and 1,550 were Model 3, said the company in its Q4 2017 Vehicle Production and Deliveries report. By comparison, the Silicon Valley-based electric carmaker delivered 26,150 vehicles in Q3, including 14,065 Model S vehicles and 11,865 Model X.
Even more notable is the fact that Tesla exceeded its guidance of delivering 100,000 flagship cars in 2017, closing the year at 101,312 Model S and X vehicles delivered, or an increase of 33% over 2016.
Tesla notes that an additional 3,380 vehicles were in transit to customers in the fourth quarter, but will not be counted as a delivery until Q1 2018. Of that number, 860 vehicles were Model 3.
The increase in Model 3 deliveries, a total of 2,410 units, including the number of vehicles in transit, bodes well for Tesla, as the Elon Musk-led company looks to overcome any negative perception that the carmaker won’t be able to hit its ambitious production and delivery targets. Following Musk’s prior address that there “are no fundamental issues with the Model 3 production or supply chain,” Tesla reassured investors in its latest report that production bottlenecks are being actively addressed.
“During Q4, we made major progress addressing Model 3 production bottlenecks, with our production rate increasing significantly towards the end of the quarter. In the last seven working days of the quarter, we made 793 Model 3s, and in the last few days, we hit a production rate on each of our manufacturing lines that extrapolates to over 1,000 Model 3s per week.”
In addition, Tesla notes that its factory was able to produce as many Model 3 vehicles in the last few weeks of December, as they did in the four months prior. “This is why we were not able to deliver many of these cars during the holiday season, just before the quarter ended.” the company further asserted.
The company also confirmed the ramp up of Model 3 deliveries to non-employee customers, as evident from the high volume of Model 3 sightings across California and other key U.S. markets. New Model 3 customers, many who took delivery from the company’s newest Los Angeles-based delivery center, have taken to YouTube to provide their first impressions of the vehicle.
Tesla reassured investors in its Q4 2017 Vehicle Production and Deliveries report that the company remains focused on quality over volume of deliveries.
“As we continue to focus on quality and efficiency rather than simply pushing for the highest possible volume in the shortest period of time, we expect to have a slightly more gradual ramp through Q1, likely ending the quarter at a weekly rate of about 2,500 Model 3 vehicles. We intend to achieve the 5,000 per week milestone by the end of Q2.”
It’s not clear how the pushback of 5,000 Model 3 vehicles produced per week by one quarter will sit with investors, but if the latest report is any indication that the company is making significant progress in ramping up, it’s only a matter of time before Tesla will truly reach its goal of becoming a mass market player in the industry.
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1 likes 2 months ago
We were supposed to be at 5,000 per week by end of 2017, then it was delayed to by the end of March 2018.
Now March 2018 we will hopefully see half that with 2,500 cars per week and 5,000 won’t be reached until June 2018.
I’m sure most of our delivery predictions will be updated rather quick. The late 2018 might be looking like mid-2019. This is really unfortunate for reservation holders like me who have a car nearing the end of it’s life. I was skeptical of my car lasting until December 2018 and was brainstorming ideas of what I could do to hold off for a month or two if my cars transmission or something broke. However, if the date is realistically going to be mid-late 2019 I will probably be forced out of my reservation. I wouldn’t be able to go 6 months without a car and buying a beater or short term lease wouldn’t really be financially possible.
1 likes 2 months ago
1 likes 2 months ago
Therefore, the important question right now is, what is the best fitting curve to the empirical data on the number of Model 3s produced per time period between July and December 31, 2017? I know that there have been folks trying to estimate the empirical production S curve. Surely someone has publicly updated their model (along with giving justifications for the numbers used) based on the latest info on the final 2017 Q4 production from Tesla. If so, does anyone have a link to it?
1 likes 2 months ago
The ramp delay is what it is. Whining and/or gnashing teeth about it won’t change it. Elon and all of the employees of Tesla are doing everything they can to speed it up, but without sacrificing efficiency and quality. That is exactly what they should be doing. The one thing we can be sure of is that the rate of production in the ramp will continue to grow for some time before it finally levels off.
This is true and it also speaks to the love of the product that most of us have. If this were a normal car that was having these production issues, people wouldn’t be nearly as upset. The fact that a few months delay has people tearing their hair out shows how much the audience is clamoring for something of such superior quality. I get it. I want mine NOW. But I’m content to wait to make sure what I get is every bit as good as I imagine it will be.
0 likes 2 months ago
I have to kind of agree with Jordan. I give Elon a lot of leeway because he makes such an amazing product, but when they are over 4 months into production and are at less than 1/5 of the goal per week, it starts to wear on you.
Yea, and I’m normally very optimistic with the companies as well. I’m a huge fan of Elon and the mission Tesla has. I also understand product delays as I’m in product management. It’s just at a point it makes it hard embrace the brand, sometimes it’s out of our control.
This is more so a model 3 problem than a Model S. It’s a totally different market based on the price point, some people just want an S to have it they may have another car. For the model 3 you start running into people who have a 12 year old card with 230k km on it. When my car breaks, I’m financially ready to buy a brand new car, however when I do it’ll be the car I own for the next 6-8 years. If I miss my Tesla reservation that may be it unless they still have the greatest car at a great price point in a decade from now.
0 likes 2 months ago
We still keep getting a rehash of outside supplier/software/necessity of quality vs volume/, etc. reasons (excuses). I absolutely want my car but at 2000 to 2500 units per week there still is a FOUR year backlog and at 5000 per week a TWO year backlog with prioritization NOT based upon registration date.
As usual I am just venting as the news is never encouraging and we aren’t being heard. We wouldn’t accept this approach at a restaurant or barber shop but, since Tesla has, we believe, a great product we accept Elon’s cheery approach. How about a penalty clause in the form of a discount or free upgrades. A coupon «book» would work and each time the delivery slides another coupon would become active. Someone mentioned that the Bolt had 4 years of development. I don’t see where that matters at this point and the 3 surely has utilized much developed for the S and X.
Happy New Year to all and I will try to mellow out! Ron
0 likes 2 months ago
prioritization NOT based upon registration date.
Where did you read this?
Since I placed my reservation it has been based on registration date with the following conditions: Telsa/SpaceX employees>Current Tesla Owners West to East coast>continental USA West to East Coast>Left side driving countries starting at USA moving East (Canada/Mexico)>Right side driving countries
0 likes 2 months ago
0 likes 2 months ago
I know I’m not making any friends but I believe that 3 years is a long time…………..Let’s see; I reserved the car when I was 69 and if I have 20 years (optimistically) left a minimum of 15% of my life spent waiting is significant!! Ron
0 likes 2 months ago
Today and for a while coming it is UNIQUE.
We are not passive, we are forgiving, because we at the very least feel that way (to say we ‘know it’ would be presumptuous… ;))
I imagine you’re now looking at 2019 because you want AWD as in Mass. You know the car with RWD has been reported as behaving quite acceptably on snowy roads and that will certainly be the case with proper winter tires. You know that, right?
Look, it’s ok to vent… just don’t overdo it… Not only at some point you’ll turn a few folks off, yet most importantly you’ll turn yourself off, and, Lord forbid, you might even pull the plug on your reservation… And that would be sad. For you. Truly.
Take care,
Mike
Edited especially for you, Ron:
(To my point about AWD, or not, above)
0 likes 2 months ago
0 likes 2 months ago
Hello again, Why is everyone so passive? Elon is not God. Like most marketers, albeit an incredible brilliant visionary/engineer, he has overpromised and underdelivered. Also,500,000 x $1000 has generated our free loan of 1/2 BILLION dollars. This is not a few months delay and I also respectfully disagree on the statement that if this was a normal car people wouldn’t be so upset; I believe that they surely would and would have lobbies via the news media consumer groups, Wall Street,etc. demanding solid answers vs these things happen………….. Space-X will have people in Space before I get a car which isn’t rocket science!
I know I’m not making any friends but I believe that 3 years is a long time…………..Let’s see; I reserved the car when I was 69 and if I have 20 years (optimistically) left a minimum of 15% of my life spent waiting is significant!! Ron
There is another good reason to be impatient: We want unambiguous evidence of the much anticipated shift from internal combustion engine (ICE) cars to electric cars. As I was walking the streets of the beautiful city of Kyoto today, I couldn’t help being repulsed by the exhaust fumes of the traffic that drove by me. My thoughts immediately went to what I anticipate will be the situation in 10 years from now. Then, the level of traffic exhaust fumes in cities around the world will be greatly reduced, and we’ll all be able to walk city streets without gagging at the air pollution. And the strong possibility of that dream for the near future becoming reality has been kick-started by the production of the Tesla Model 3. So, when the Model 3 production ramp goes into high gear, and we start seeing lots of Model 3s on our streets (and in our garages), we will know that the dream is becoming a reality. I am VERY impatient for that to happen.
Fortunately for the rest of us, Elon Musk is even more impatient for the switch from ICE cars to electric cars to happen, which is why he has been working night and day for the last 14 years to make that dream a reality. But making the kinds of revolutionary changes to the automobile industry that Elon Musk has in order to bring a high quality, mass-market, sexy, efficient, long range, safe, electric car to market ain’t easy. Nobody has done anything remotely like this since Thomas Edison ushered in the era of wide spread electricity use, or Henry Ford produced the Model T and ushered in the era of the automobile. Musk’s Model 3 is a car with a revolutionary design built from the ground up. He has created the world’s largest lithium ion battery plant to create enough batteries to produce the Model 3. He has been creating the world’s first global super-charging network to allow drivers of the Model 3 (and Models S, X, and Y) to drive anywhere a ICE car can go. And he has been creating the automation infrastructure at his Fremont and Gigafactory plants to create the Model 3 in a fully automated fashion to enable the fastest most efficient production of the Model 3 possible.
So, yeah, there are lots of reasons to be be impatient. But there are also lots of reasons to be in awe of the incredible technological changes that Elon Musk has been bringing about. And an understanding of the magnitude of the technical challenges that Musk and Tesla Motors have been surmounting to bring us the Model 3 puts those production ramp delays into perspective. Patience Grasshopper.
0 likes 2 months ago
Hello Jordan, You kind of answered your own question as you listed 5 or 6 priorities. No offense to anyone, but if I’m in Massachusetts the above swamp has to be drained before I receive delivery. I «reserved» on 4/4/16 and the estimator says that I will not have a car until 2019. My take is that this is NOT based on registration date. Ron
Okay, but this was known to us since day 1. It’s not like the changed it. And Tesla and SpaceX combined was is around 40k employees. And obviously a lot of them either own a S or X, can’t afford the 3 or simply don’t want it. They delivered like 1,500 cars and then went to the general public. This doesn’t really set the queue back that much.
Tesla owners I can’t assume being too many either, if you bought a $100,000 car why would you want a $40,000 car? And I don’t believe the reservation jump was applicable to resale owners.
Honestly, I would say this is like 5,000 cars total before moving to general deliveries… Delays are really the thing preventing deliveries not Tesla employees getting their cars first.
0 likes 2 months ago
I agree with everything you are saying but I think that your making my case for me.
If it is only 5000 and you can double that if you wish, the next in line are CA residents. If my April 4th reservation translates to Jan 2019 and they only make 1000 – 2000 units per week, does that mean that there are 75000 CA orders ahead of me? They are saying 5000 per week end Q2 so that would be a much larger number. That’s why I say there may be well north of 100000 units delivered before my April 4th reservation.which I suggest is unfair. I’m not sure why no one else ever comments and perhaps my thinking is all wrong. Regards, Ron
0 likes 2 months ago
Hello again Jordan,
I agree with everything you are saying but I think that your making my case for me.
If it is only 5000 and you can double that if you wish, the next in line are CA residents. If my April 4th reservation translates to Jan 2019 and they only make 1000 – 2000 units per week, does that mean that there are 75000 CA orders ahead of me? They are saying 5000 per week end Q2 so that would be a much larger number. That’s why I say there may be well north of 100000 units delivered before my April 4th reservation.which I suggest is unfair. I’m not sure why no one else ever comments and perhaps my thinking is all wrong. Regards, Ron
I’m thinking there is something wrong with your account? Maybe you should reach out to Tesla. I reserved after you, live in Canada and my estimate is better than yours.
0 likes 2 months ago
Michael, what are your thoughts re this scenario as Jordan ordered after me (I kind of thought that my 4/4/16 date was kind of early!) and he is in Canada? Is there a real plan in place? Thanks all, Ron
0 likes 2 months ago
Thanks for the encouragement Jordan and I hope that you are right!
Michael, what are your thoughts re this scenario as Jordan ordered after me (I kind of thought that my 4/4/46 date was kind of early!) and is in Canada? Is there a real plan in place? Thanks all, Ron
Ron, candidly I am not in a position to talk about any plan…
All I can say is, everything being equal (owner/non owner status, same choice of car – e.g. LRB, RWD, first production, reservation date…) somebody in Mass. should get to order before somebody in Canada…
0 likes 2 months ago
Therefore, the important question right now is, what is the best fitting curve to the empirical data on the number of Model 3s produced per time period between July and December 31, 2017? I know that there have been folks trying to estimate the empirical production S curve. Surely someone has publicly updated their model (along with giving justifications for the numbers used) based on the latest info on the final 2017 Q4 production from Tesla. If so, does anyone have a link to it?
Ask and you shall receive. Ben Sullins just came out with a publicly updated model of the type I was asking for, based on the empirical production data that has been made public by Tesla. He has fit several different logarithmic models to the data, based on different assumptions, each of which he discusses:
https://teslanomics.co/200k-model-3s-2018-estimate-teslas-delivery-ramp/
