Tesla Q1 Earnings: 500k EVs Built In 2018, 100,000+ Model 3s in 2017

1 year ago by Jay Cole 120

Tesla Reported First Quarter Earnings On Wednesday

Tesla Reported First Quarter Earnings On Wednesday

After the bell on Wednesday night, Tesla Motors reported first quarter earnings and offered guidance on future production and sales targets at the company.

Given The Strong Mix Of P90D Model X Deliveries, The Average X Transaction Was 30% Higher Than That Of The Model S

Given The Strong Mix Of P90D Model X Deliveries, The Average X Transaction Was 30% Higher Than That Of The Model S

For the first 3 months of the year, Tesla reported a loss of 57 cents per share, 3 cents better than the street had been expecting.  Revenue came in at $1.6 billion, roughly in line with then 1.61 billion estimated.

For the quarter Tesla said it made deliveries of 14,810 Model S and X vehicles, a re-iteration of the sales miss it disclosed last month thanks to “hubris“.

“During the quarter, we delivered 14,810 vehicles, almost the same as what we estimated in our April announcement. Model S average prices improved 1.4% sequentially, as price increases and higher option take rates offset a slight mix shift to less expensive Model S variants. Average Q1 Model X prices were about 30% higher than for Model S.”

Future Production and Guidance

Given Model 3 demand, the company said it would pull forward plans to hit the 500,000 EV produced milestone (from conference call: rough estimate of 300k-400k of which being made up of Model 3s), but that it would likely require more cash to do so:

“Additionally, given the demand for Model 3, we have decided to advance our 500,000 total unit build plan (combined for Model S, Model X, and Model 3) to 2018, two years earlier than previously planned. Increasing production five fold over the next two years will be challenging and will likely require some additional capital, but this is our goal and we will be working hard to achieve it.”

From Conference call: 500k target bump is in reaction to Model 3 demand, Musk says the company is  “hell bent on becoming the best manufacturer on earth.”  Musk also says his desk is the end of the production line, and that he has a “sleeping bag nearby” in his office that he makes use of often.

Despite a Q1 delivery miss (thanks to unnecessary complications/timelines on the Model X), the company kept to the same full year guidance, pegging that number at 80,000 to 90,000 units.

For Q2 the company pointed to a lot of inventory/deliveries headed to Europe slowing results, but that it expected to still deliver some ~17,000 vehicles, while producing ~20,000.

As for production going forward, Tesla sales by the end of Q2, a level of 2,000 vehicles per week will be met, and that will “lay the foundation for a strong Q3 delivery number”.

Tesla Model 3 - "Biggest

Tesla Model 3 – “Biggest Consumer Product Launch Ever”

Tesla Model 3

Tesla took the time to point out that 325,000 reservations were made over the first week (~400,000 today) without the help of any advertisement or paid endorsement.

“This implies about $14 billion in future sales, making the Model 3 introduction the biggest consumer product launch ever”

From Conference call: Tesla CEO says the company is learning from Model X, with a focus on “more simplicity on the Model 3.”  Future Model S elements are only approved if they are also easy to manufacture, and the failure/manufacturing risk is low.

Tesla is also telling suppliers they have to be ready to go by July 1st, 2017 – Musk stresses this is not start of production (or an “impossible date” to start production), but rather an on hand date for all components/parts needed to start the build – in relation to those parts needed, Model 3 design is almost complete.   Musk states that Tesla goal is to build at least 100,000 Model 3s before end of 2017.

Of the Model 3 reservations to date, 93% of the consumers had never “interacted”  with Tesla before.  Tesla also noted no adverse affect on the Model S as a result.

Tesla Gigafactory Cell Production Begins Late In 2016

Tesla Gigafactory Cell Production Begins Late In 2016

Gigafactory Update

While the Gigafactory today is operational assembling packs for products such as Tesla Energy’s Powerwall, actual production has yet to commence, but Tesla reports it will soon-ish.

“We remain on plan to make the first cells at the Gigafactory in Q4 2016, and we are adjusting our plans there to accommodate our revised build plan. “

Model S And Model X Demand

A Refreshed Model S And Public Attention For The Upcoming Model 3 Helped Raise Demand For All Tesla Vehicles Of Late

A Refreshed Model S And Public Attention For The Upcoming Model 3 Helped Raise Demand For All Tesla Vehicles Of Late

While we knew Tesla would have to touch on Q1 demand for the S and X, we also knew they could not resist teasing about the early Q2 demand profile either:

“Q1 Model S net orders rose 45% compared to a year ago, and grew at a faster pace than last quarter. The more rapid pace of growth was driven by increased order growth in North America and Europe, and a more than 160% increase in orders from Asia compared to a year ago.

…Notably, this demand level was reached ahead of the Model S refresh, before Model X could be seen in stores, and prior to the unveiling of Model 3, which we believe is stimulating demand for all of our vehicles.”

Tesla Model X Production/QC update

From the conference call:  Elon Musk says that Tesla just had its first “flawless production” of a Model X run off the Fremont line; in other words, a perfect score coming out of the “second layer” of QC, and pre-delivery inspection.

Besides delivering ~2,400 Model Xs in Q1, the company said it built 2,659 SUVs during the quarter…as compared to the 507 build in the last quarter of 2014.

Tesla Supercharging Footprint Is Expanding Rapidly In Anticipation Of Almost 400,000 New Tesla Arriving Over The Next ~3 Years

Tesla Supercharging Footprint Is Expanding Rapidly In Anticipation Of Almost 400,000 New Tesla Arriving Over The Next ~3 Years

Infrastructure & Supercharging Update

Tesla said it planned on adding 70 new retail stores and service locations in 2016 – bring the net total to over 300.

As for Supercharging stations, 29 were added in Q1, with 311 Destination charging locations coming online.  The total number of Supercharging stations now numbers 615, with 2,200 Destination chargers. The total connection point count rises to 3,600 at Supercharge stations, and 3,700 at Destination locations.

Deeper Financial Numbers

Tesla Plans On Delivering 17,000 Model X/S Cars In Q2

Tesla Plans On Delivering 17,000 Model X/S Cars In Q2

*- GAAP operating expenses were $501 million and include $83 million of non-cash stock based compensation

*-Cash and cash equivalents rose to $1.44 billion “aided by more effective cash management and $430 million drawn against our asset based credit line” – Tesla noted that $350 million was paid back in early April thanks to Model 3 deposits.

“Our GAAP cash outflow from operations during the quarter was $250 million. After adding $242 million of cash inflows from vehicle sales to our bank leasing partners, our cash flow from core operations was nearly breakeven”

*- Total Q1 gross margin was 21.7% on a non-GAAP basis and 22.0% on a GAAP basis.

*- Tesla directly leased 1,405 cars to customers in Q1

*- $57 million of ZEV credit revenue

*- Q1 Automotive gross margin (ex-ZEV credit revenue) was 20.0% on a non GAAP basis and 19.6% on a GAAP basis.

“Overall, our non-GAAP Automotive gross margin declined 90 basis points over Q4 due to an increase in delivery mix of Model X, which carries a lower margin during its ongoing production ramp phase.”

Second Half Projections

“Looking out beyond Q2, we remain confident that we can deliver 80,000 to 90,000 new Model S and Model X vehicles in 2016. This is due to the growing demand we are seeing for Model S and Model X, the improved rate of production that we project for Q2, and the production increases planned for the back half of 2016.

Model S cost reductions and improving Model X manufacturing efficiency should cause Automotive gross margin to increase. We are on plan for Model S non-GAAP gross margin to approach 30% and Model X non-GAAP gross margin of about 25% by year-end, with higher Model X gross margin in 2017.”

“Given our plans to advance our 500,000 total unit build plan, essentially doubling the prior growth plan, we are re-evaluating our level of capital expenditures, but expect it will be about 50% higher than our previous guidance of $1.5 billion for 2016. Naturally, this will impact our ability to be net cash flow positive for the year, but given the demand for Model 3, investing to meet that demand is the best long-term decision for Tesla.”

The stock initially traded up about $7 (3%) following the news in extended trading after the completion of Tesla’s conference call, but opened Thursday lower by about $10 (4%) as analysts have an adverse reaction (disbelief) to Musk’s optimistic Model 3 production plans for 2017 (real time quote here)

 

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120 responses to "Tesla Q1 Earnings: 500k EVs Built In 2018, 100,000+ Model 3s in 2017"

  1. ffbj says:

    Stock is radioactive, too hot to handle. In that regard I will take Mic Jagger’s advice.
    Better than expected loss.

    1. Jim Whitehead says:

      Radioactive? No but its hot and has made many people millionaires, so far. Nobody should invest in Tesla unless they are comfortable with high risk for a high reward. I said this years ago, before the Model S came out, when the stock was $22 and when bears were saying it would soon fail.

      Example: My middle class programmer brother put his entire six figure life savings into Tesla in 2012 (taking a huge risk I didn’t). His brokers called him insane. He can now retire as a millionaire, while his brokers are still working.

      1. Martin Winlow says:

        I hope he taken at least his initial investment out by now!

  2. Kevin says:

    Riiiight. You can’t hit your quarterly target, fail at ramping up your latest vehicle, and just had two top manufacturing engineers leave yet you pull the 500k target up two years. Smoke and mirrors.

    1. Anon says:

      The only smoke is from job fatigue.

    2. RexxSee says:

      I trust Musk to devise a good plan. he always does… He always delivered..

      I would forgive him a lot if he is “late” to 2019 since I will get my Model 3 one year earlier anyway! 😉

      1. Spider-Dan says:

        He “always delivered”… just not on time.

        1. Kdawg says:

          Don’t worry. They are going to buy everyone in the offices a THIRD monitor. More computer monitors always makes people work faster. 🙂

          1. Steven says:

            We must work for the same company.

      2. pjwood1 says:

        To owners of a Model S, who pre-ordered M3, the “93%” of orders having “never interacted” sets them up much further ahead in the cue.
        -expected a much higher Model S owner take rate, than just 7%.
        -A real pearl of fear, for the industry.
        -This could accelerate the tax-credit changeover within 2017.
        -Glad it looks like I could have one, in ~15 months.
        -This changes the earnings growth rate for the company, affecting stock value. Will it recover?

        Shocked, if even 50k cars come true in 2017.

        1. Rob says:

          7% of 400000 is 28000, meaning 28000 out of ~100k Model S and X owners bought a model 3. So ~1/4 bought another car from tesla.

          1. ModernMarvelFan says:

            “So ~1/4 bought another car from tesla.”

            You mean “at least”.

            Because they can buy a newly revised Model S/X. So, we only know that at least 1/4 of them ordered Model 3.

            1. pjwood1 says:

              A number of owners ordered two, which makes it less than a quarter ordering A Model 3. That’s why 7% surprised me. It’s good news because its “conquest” buyers coming from other brands.

          2. Brian says:

            my question is- it says 93% never “interacted”- does that mean ONLY current owners, or people like me who are not current owners?

            I have been on their email list for a long time, and I did a test drive of an S last year, so they certainly have my name/address/email. What is their definition of “interacted”? If the 7% includes people like me, I wonder what the % of current owners is…

        2. Grendal says:

          That was really terrible math. And then you draw unbelievable conclusions from your incorrect assessment. I’m surprised you haven’t lost your shirt in the stock market with that kind of reasoning.

        3. Grendal says:

          Further, the other rather obvious error you made was that a Model S or Model X owner would likely buy another Model S or Model X, not necessarily a Model 3.

          There have now been two polls of current owners and the statement from them is that they plan to buy another Tesla. The average of the two polls was 19 out of 20 current owners plan to buy another Tesla.

        4. Grendal says:

          I get angry at you but don’t bother to carefully read your comment. My error, sorry.

    3. David Murray says:

      Typical anti-tesla talk. It’s sort of like landing a man on Mars and somebody will complain that they were a week late or didn’t have their boots shined properly.

    4. The Tesla religion prayers need their next life promises.

      1. sven says:

        Heretic! Sinner! Repent and cast out thy evil ways! Say the Tesla Prayer 100 times as act of contrition.

        Our Tesla built in California,
        hallowed be thy name.
        Thy made in your factory.
        Thy will be driven
        on roads as it is in navigator.
        Give us this day our daily Tweet,
        and forgive us our missed forum entries,
        as we forgive those who wrote them.
        And lead us not into electric car myths,
        but deliver us from fossil fuels.
        For thine is the future,
        and the market share, and the autopilot,
        for ever and ever.

        Ludicrous!

        😉

        https://teslamotorsclub.com/tmc/threads/teslas-prayer.67558/

        1. missdeborah says:

          LOL !!!!!!!!! I like you 🙂 You actually made me smile after 2 fricking days of fighting with climate change deniers…Dang they are nuts !!!!! I tell you

  3. Alan says:

    How’s that Tesla short looking stompers !

    1. TSLA short is always easy profit. Down from 260 to 220 in no time, lot of occasions to take short profits.

      1. Michael Will says:

        Hope you took it now, because tomorrow its going to be a tsunami of hurt for shorts again…

      2. Pushmi-Pullyu says:

        Counter-Strike Cat sputtered:

        “TSLA short is always easy profit. Down from 260 to 220 in no time, lot of occasions to take short profits.”

        Yeah? Then why do you and the other Tesla short-sellers keep posting on InsideEVs when the stock is going up… which means you should have gotten out, but didn’t?

        Your desperation is showing… again and again and again.

        “Tesla envy happens when other people have, ahem, long positions and yours is too short.” — Jim Whitehead

    2. Rick (no, not that Rick) says:

      As an experiment, I shorted Tesla the day of the the Model 3 reveal. Closed it today for a $20 per share profit. I sweated for a few weeks, though.

  4. Doggydogworld says:

    500k cars/year by 2020 was extremely ambitious. By 2018? Wow, that’s just insane. Or ludicrous. Or maybe even plaid.

    1. Samwise says:

      Cumulative…

      1. Breezy says:

        It’s not cumulative. They really mean 500,000 cars per year in 2018. The plan up until now was 500,000 cars per year in 2020.

    2. pjwood1 says:

      It’s the “build 100,000 Model 3, by end of 2017” that sets a hard, accelerated target.

    3. leafowner says:

      That Freemont factory used to produce 500k cars /year and that was before all the automaton and robotics would love to see that again! I reserved mine at 10 pm on the reveal day so I’d LOVE to get mine in 2017!

      1. JeremyK says:

        500K/year was when two very experience high volume auto manufacturers were running the show. And yes, they had robots. Jeez.

  5. Alaa says:

    Money will move from Apple to Tesla.

  6. Big Solar says:

    I thought he meant 500k cars cumulative by 2018??

    1. TomArt says:

      Either way, it’s still crazy – even makes me nervous.

      Granted, the Model 3 is more straightforward and, aside from the rumored HUD, makes no advances beyond what they already know how to execute with the Model S.

      1. Anon says:

        The main downside with Model 3, is as JB said, “…for better or worse…” Model 3 is an entirely new vehicle platform. There are always lots of unknowns with any new architecture.

  7. Get Real says:

    Despite what the professional stock manipulators/fudsters like Spiegel, Wahlman, etc say, Tesla will have no problems raising capital for this HUGE expansion.

    I predict that Fremont will expand to 5 full lines built sequentially and only 1 line will be making S and Xs interchangeably.

    All this warehouse space they just acquired will be used for in-house parts/sub-assemblies manufacturing and other staging to support Fremont which will be full with the 5 lines.

    All of this dance will mirror the Giga ramping up.

    You read it here first.

    1. MaxEv says:

      true dat

      1. Joshua Burstyn says:

        Seconded.

    2. Speculawyer says:

      Yep, Tesla will have no problem raising very large amounts of additional capital. Silicon Valley has a lot of wealthy people ready to invest.

      There is a lot of faith in Elon right now with all those pre-orders and landing a rocket on a barge.

    3. Pushmi-Pullyu says:

      Get Real said:

      “All this warehouse space they just acquired will be used for in-house parts/sub-assemblies manufacturing and other staging to support Fremont which will be full with the 5 lines.”

      Well certainly Tesla can move some of its in-house parts and subassembly manufacturing out of the Fremont auto assembly plant, to other buildings. But can the Fremont plant really handle 500k cars per year? Historically, from what I’ve read, it has never even remotely approached that volume.

      As with Tesla’s new plan to sharply accelerated the ramp up, to 500k cars per year by 2018, we’ll have to wait and see if they can really achieve that.

      But Tesla would do well to start building a new auto assembly plant, in Asia or Europe, ASAP. Even if the Fremont plant can handle 500k cars per year, they’re going to need to look ahead to even higher volume. If they can ramp up to 500k per year in only 2-1/2 years, or a volume even remotely in the ballpark of that, it strongly suggests that Tesla can easily grow to the size of Ford, and much more quickly than I thought that could happen. Tesla won’t want to have its growth limited by a single maxed-out auto assembly plant.

  8. Carcus says:

    ““Q1 Model S net orders rose 45% compared to a year ago, and grew at a faster pace than last quarter. The more rapid pace of growth was driven by increased order growth in North America and Europe, and a more than 160% increase in orders from Asia compared to a year ago.””

    Wow.

    Definitely NOT something ‘premium german automakers’ (or their shareholders) want to hear.

    1. TomArt says:

      Agreed, but the next part is the most important:

      “Notably, this demand level was reached ahead of the Model S refresh, before Model X could be seen in stores, and prior to the unveiling of Model 3, which we believe is stimulating demand for all of our vehicles.”

      Awesome. That’s the kind of demand-side fundamentals that you just can’t beat.

      1. Stimpacker says:

        I’ve already experienced this. Was looking at used Tesla Model S and all the inventory is gone. Checked both Tesla and 3rd party sites. All gone. What’s available are selling at near brand new prices.

  9. Samwise says:

    This is interesting.
    “Tesla noted that $350 million was paid back in early April thanks to Model 3 deposits.”
    So if you wondering exactly what your $1000 is doing, its saving Tesla interest on $350,000,000 which can then be spent elsewhere.

    1. TomArt says:

      Yeah, I noticed that – fine by me. I knew the terms before I put my deposit down, so it’s nice to know where it’s going.

  10. wavelet says:

    Given deliveries of <15K cars in Q1 (no matter what the reason), Tesla has their work cut out for them to hit the 80K-90K target for the year… It'll be interesting to see if the manage to do it (the original goal mentioned last year before the X delays was 100K total cars in 2016).

    On Musk saying re the Model 3 reservations
    "This implies about $14 billion in future sales, making the Model 3 introduction the biggest consumer product launch ever",

    I'm really surprised at him. He doesn't usually distort the truth like this.

    It implies no such thing, since those are not orders and the product hasn't actually been launched, there being no detailed specs or pricing. Plenty of people reserved just to keep their options open later on.

    1. TomArt says:

      He said “implies”, not “is”. He was making a relative comparison, not a declaration.

      If he had, then yes, that would be very disingenuous on his part.

      1. Terawatt says:

        The primary and normal meaning of “implication” is what necessarily follows, what can be deduced from what is known. Elon is hiding behind the much less common, and frankly still very inaccurate, usage meaning “involved in”.

        We can forgive him because the point he uses this to make actually is true. The Model 3 is the biggest product launch ever!

        1. Pushmi-Pullyu says:

          I find myself in the rather strange position of defending Elon’s hype, for once.

          The word “imply” has more than one meaning. According to Merriam-Webster, one definition is “to contain potentially”. It is that implication of the potential for future sales which I inferred into Mr. Musk’s remarks, and I think that’s what he meant.

          Now, that’s not to say that Elon isn’t practicing hype again. I don’t know if his claim of “$14 billion in future sales” or “the biggest consumer product launch ever” would pass a reality check. But let us please castigate Elon only for the sins of overstatement which he has actually committed, not those he hasn’t.

  11. MikeG says:

    If the deliver 80-90K Model S/X in 2016, then they should reach the 200K point in late 4Q16.

    If first Model 3 deliveries were in 4Q17, they would be eligible for a partial or no tax credit, right?

    1. buu says:

      us/world. there was article with prediction

      1. TomArt says:

        Yep – what “buu” said.

        1. TomArt says:

          However, in the unlikely event that they actually meet these new production targets, then yes, we could use a new prediction chart…anyone???

  12. Bloggin says:

    What I am waiting for is for new Tesla models to drive themselves out of the plant after production, and park themselves preparing for shipment.

    1. Daniel says:

      Or better yet be “summoned” from the factory finished product lot?? by it’s new owner and drive itself to his / her place of work or house etc.

      1. Terawatt says:

        I’m looking forward to my Model 3 showing up with 25k miles on it, having driven itself to my house in Norway!

        You guys… Nobody but Americans are capable of utterly forgetting that there is a world outside your borders.

        1. ffbj says:

          Perhaps if you live in Alaska, and you can see Russian from your house.
          It is true though in general that Americans are mostly clueless about what is going on in the world.

        2. Brian says:

          On behalf of all Americans, I apologize for our ignorance.

          (I have needed to do that a lot lately) 🙂

  13. Four Electrics says:

    Tesla would have needed to raise capital anyway, but accelerating production is a good excuse. Cash was king at Tesla for about three months. Spending is in Tesla’s DNA and it is a hard habit to break.

    1. TomArt says:

      Why criticize them for trying to meet demand?

      From what I could tell, their previous ramp was planned so that they would not need another capital infusion (cash is king).

      Now that we, their customers, established staggering levels of demand for all models, they don’t have a choice. It appears that they cannot wait for X ramp-up and revenue growth and Tesla Energy revenue growth, despite the recent spike in orders.

      1. Four Electrics says:

        That’s the story. And it sounds good. I just don’t believe it. I assert they would have had to raise capital regardless of Model 3 demand. I wouldn’t be surprised if they raise a second round a year after the first round. Nor do I believe that customers who placed a deposit for a Model 3 in 2018 would really walk away if their car arrived in 2019 instead, or even 2020. Finally, I don’t believe that more cash will significantly accelerate Model 3 development. It’s not as if they were intentionally holding off on equipment purchases. Certainly cash was not the cause of Model S and Model X development delays, or the slow production ramp of the X.

        1. Michael Will says:

          Interesting though how the insideevs report card only accounted for half of the amount of vehicles delivered in Q1-2016. I wonder how that went wrong, they say its guess work but I never saw them that wrong. I think tomorrow will be interesting at open. I will drop some more money into TSLA.

          1. Doggydogworld says:

            Isn’t the report card US only? The 14,810 TSLA reported is global.

            1. Jay Cole says:

              Michael,

              Yes, as mentioned above, our scorecard is for the US plug-in sales only. Tesla Q1 report is for worldwide numbers.

              And by that metric, we have never been out by more than 611 units for the entire year… (~250 at most in a single quarter) when confirmed numbers have been made available (sometimes years later).

        2. Josh Bryant says:

          I agree Four Electrics.

          The Model 3 launch and Model S refresh were carefully timed to stoke demand to new all time highs, coinciding with decreased Model X spending. Carefully designed to lead into the inevitable cash raise.

          That is just good execution on Musk/Tesla. They always find a way to raise on good terms.

          1. Pushmi-Pullyu says:

            Tesla Motors has, apparently, become a master at creating and managing demand to best serve its corporate strategy. (With the notable exception of China.)

        3. Pushmi-Pullyu says:

          Four Electrics said:

          “Certainly cash was not the cause of Model S and Model X development delays…”

          As Musk tells it, Tesla was mere hours away from bankruptcy, with Elon seriously contemplating a buy-out offer from Google, until (if I recall correctly) the DOE loan was approved at the last minute, giving Tesla the cash it needed to put the Model S into production.

          Claiming that a cash shortage played no part in the delays in getting the Model S into production, seems to be at best a questionable assertion.

  14. KevinL says:

    April production included a lot of vehicles in transit to Europe. Produced but not “sold” until the customer takes delivery. That’s why April numbers appear low.

  15. Speculawyer says:

    “Musk also says his desk is at the end of the production line, and that he has a “sleeping bag nearby” in his office that he makes use of often.”

    What? Needs a little editing there.

    1. Skryll says:

      Editor not enough sleep likely hu?

    2. agzand says:

      He forgot to mention the porta potty.

      1. sven says:

        Elon doesn’t have time to use a porta potty. It’s much more efficient for Elon to wear adult diapers.

    3. Ambulator says:

      I don’t see any problem with the way it was stated, although the word order is a little unusual.

  16. pjwood1 says:

    RE: 350mm paid back, with deposits. Other makers all p/o’d ’cause Tesla be like “crowd funded”.

    1. TomArt says:

      😀

  17. Spider-Dan says:

    So if I understand correctly:

    – 6 weeks ago, the Model III was unveiled for the first time, with a promised ship date of Q4 2017
    – Model III development is still ongoing
    – Model S and Model X took years from their first unveiling to finalize development
    – despite all this, Tesla will manufacture 100,000 MIIIs by the same time as the previously announced release date

    I’ll give Musk this: since Tesla hasn’t faced any real consequences for wildly missing target dates before, it’s hard to see why he shouldn’t promise the moon whenever he likes. Model Y deliveries in Q2 2019!

    1. Frank says:

      Only this time… Tesla has 15 000 employees.

      Compared to 1000-2000 at the time you referred.

      1. Spider-Dan says:

        Setting aside the fact that Tesla definitely had more than 2000 employees while the Model X was being delayed for 2 years, I don’t know that “Tesla has 15,000 employees now!” is exactly the most convincing response to skepticism that they will produce 100,000 units of an unfinished car by the end of next year.

  18. Frank says:

    100 000 Model III’s before 2018 ! I can live with that 🙂

  19. So no updated number of Model 3 reservations? The bubble is dead after only 3 weeks. That was fast.

    1. Speculawyer says:

      He said the last update would be a week after the launch . . . it was 325,000. However, a ‘nearing 400,000’ slipped out.

      I don’t expect an update and I doubt it is growing much. Not many people eager to join a line with 400,000 people ahead of them.

  20. ModernMarvelFan says:

    So, 14,000+ 17,000 for Q1 and Q2 for about 31K to 32K of delivery. In order to reach 80K, Tesla needs to deliver more than 48K cars for the next two quarters…

    No wonder two of the manufacturing executives left or were forced out…

    That is 50% increase in delivery. Hope it happens.

    1. ffbj says:

      Right. That is a pretty tall order.

    2. Doggydogworld says:

      Musk claimed a 2,000/week run rate by end of June. 17k in Q2 plus 2k/week in Q3 and Q4 would be 84k for the year. Any ramp above 2k/week would add to that, but their assembly line may max out at that level.

    3. Terawatt says:

      Frankly, unless they have been very dishonest about the reasons for those numbers so far, 80k should be “very doable” to use a Muskism.

      I would love to be a fly on the wall in the offices at various incumbent headquarters tomorrow! Probably the car bosses of the world are half incredulous, yet too scared to simply brush it off as bravado.

      My personal guess for the EV tipping point, where car makers put EVs front and center of their efforts (development and marketing) has been 2025 for a while. I may have to move that forward a couple of years because of this!

      1. pjwood1 says:

        Headquarters speak market share. Tesla hasn’t consummated on the market share gains of the 400,000, really, until people are in a car. It is the thought he is going to convert those reservations more quickly, that has to frustrate other makers this morning.

  21. Vy says:

    Well, I think this is a point that will allow us to see where everything is heading. From this wave of good news and how it is presented I feel a bit desperate attempt to show that everything is OK and is it? No, I don’t think so. Very aggressive “to good to be true” news flood recently, signals very big problems on TESLA end.

  22. agzand says:

    I went through the numbers and the only significant improvement is $57m ZEV credits vs $8m in the last quarter. If you remove this volatile revenue their loss will be bigger than the last quarter.

    1. Get Real says:

      Cannot see the forest for the trees agzand.

      Or as Winston Churchill said:
      “The pessimis sees difficulty in every opportunity. The optimist sees opportunity in every difficulty.”

      Once 400,000 people eager for a Tesla put down $1000 apiece a paradigm shift happened.

  23. kdawg says:

    “From Conference call: Tesla CEO says the company is learning from Model X, with a focus on “more simplicity on the Model 3.” Future Model S elements are only approved if they are also easy to manufacture, and the failure/manufacturing risk is low.”
    ———–
    LOL, what happened to compelling?

    Anyway, I’m glad they are finally seeing the light of K.I.S.S. as many have suggested.

    1. Pushmi-Pullyu says:

      Nearly 400,000 people found the Model ≡ to be compelling enough to put down $1000 “earnest money” on it! I’d call that pretty compelling. In fact, a lot more compelling than almost everyone thought… even at Tesla!

      Seems to me that Tesla has little need to mention “compelling” with any future PR statements, with regards to the Model ≡. That has already been thoroughly demonstrated.

      1. Kdawg says:

        They need to replace the word “compelling” with “quality”. People looking at the Model 3 are more frugal with their money. They don’t want to to throw their money down the toilet on a car that isn’t up to snuff, no matter how fast it goes, or how big the touchscreen is.

  24. mxs says:

    Wish them luck And a lot of IT. They will certainly need it.

    It’s like going from not being able to walk to sprint.

    I am not sure why they jeopardize their future (because once the investors lose patience the game is over ….) with such lofty shifts in thinking and long term plans.

    I guess we will have to wait and see how well or not so they do in the not so distant future.

  25. Alan says:

    I think people often forget the in terms of how long Telsa have been in existence, they barely have the nappies (diapers) off yet, others have had decades to perfect their business.

    The most likely outcome is that Tesal are only going to get exponentially better at what they are doing, once they are producing batteries for car & storage in that gigafactory by the boat load, they will have such an advantage over everyone else for many years.

    It’s not inconceivable that their stock price could be north of $500 in 5 years time.

  26. Pushmi-Pullyu says:

    “Additionally, given the demand for Model 3, we have decided to advance our 500,000 total unit build plan (combined for Model S, Model X, and Model 3) to 2018, two years earlier than previously planned.”

    Okay, this goes beyond merely astonishment: My head just exploded! I cannot comprehend how Tesla could possibly speed up its expansion over the next two years by that much. Won’t they need to start building a new auto assembly plant, or take over an existing one, immediately? The rule of thumb is that it takes two years to get a new factory running and fine-tuned for volume production. And Tesla’s history does not point to being able to do this faster than is the norm.

    Now, this isn’t to say that Tesla can’t do it. After all, Tesla has been confounding the naysayers ever since it was incorporated. But on this, altho I live in Kansas, I’ve sometimes lived on the Missouri side of the State line in Kansas City, so I’ll say: “I’m from Missouri; show me!”

    1. Kirk says:

      during the conference call Elon mentioned that the Fremont factory and the giga factory should be capable of producing 1 million cars per year. Although this may not be the wisest way to proceed.

  27. Alaa says:

    What will happen to the demand if Tesla sells 500,000 million cars a year?

    1. Pushmi-Pullyu says:

      Well, since the human population of Planet Earth is only an estimated 7,322.6 million as of today*, I’d say that 500,000 million cars should pretty well satisfy demand. 😉

      *source: http://www.census.gov/popclock/

      1. Alaa says:

        That was a trick question to see who is really paying attention.

  28. Phr≡d says:

    Thanks Jay for an Excellent summary of what many would agree was a ‘headgear required’ conference call. I’m a bit long-in-the-tooth and that was one ‘remember this day’ event, much like ≡ rez day.. we all kinda’ Hoped, but hey, what chance Is there really, with a young small company.
    No doubt the realists will get my head back to likeliest, but it is kinda’ Nice to briefly imagine Summer ’18 for a delivery (fly-over who-cares states)

  29. floydboy says:

    This kind of ramp up in light manufacturing is hard, but in a heavy industry like automobiles, it’s well……ludicrous!

    1. ffbj says:

      It’s robots to the rescue. “Rescue Robots.” Good cartoon series title for kids.

  30. Pete says:

    If the will ramp up so fast, quality will be below every French car and the service center will be booked out for some years.

  31. Someone out there says:

    I wish they didn’t advance the plan like that. It will lead to a lot of headache when they are forced to do a recall because something went wrong in manufacturing, and it will happen. 500k cars in 2020 is already a very aggressive plan, they shouldn’t try to push even harder.

    However, given all this I’m sure the other manufacturers are watching very closely. If Tesla sells 500k electric cars in 2018 (or even 2020) I’m sure they would like a slice of that pie. Any player that still doesn’t have advanced plans to sell long range EVs by 2019-2020 by now is simply obsolete, no matter how many ICEs they sell today. ICEs are going away and it will happen much quicker than people think.

  32. tftf says:

    Reality:

    Greg Reichow, Tesla’s vice president of production and one of its highest-paid executives, and Josh Ensign, vice president of manufacturing, will leave the company.

    Musk is out of touch with car manufacturing reality. These VPs probably told him his goals are impossible.

    Model3 mass-production by 2017 will result in QC fiasco and massive recall/warranty costs, that much is pretty much confirmed.

    1. Tech01x says:

      tftf,

      You hope this is the case for your short position in TSLA. But the competitor cars aren’t so much competitors and Tesla will command a far higher marketshare of the rapidly expanding BEV market well into the 2020’s.

    2. TomArt says:

      Not “confirmed”, but “likely”.

  33. Benz says:

    How many Tesla Model X deliveries in Q1 2016?

  34. tftf says:

    Tesla bad management 101:

    Place impossible goals on staff and suppliers, then cry foul when things go wrong (without ever looking in the mirror).

    1. ffbj says:

      At least he didn’t toss them in the shark pool for failure, like some other movie villains do.
      But of course in Legacy car companies executives rarely get fired for failure just moved to another division.

    2. Get Real says:

      LMAO, tftf bad Tesla short position management 101!

      You and your Seeking Liars buddies short positions are really circling the bowl now tftf.

      As you know all Tesla has to do is get the M3 into mass production in late 2017 and your shorter money is gone.

  35. JeremyK says:

    Does anyone disagree that Tesla has been production constrained throughout their existence? How can Musk honestly say that they can produce 100,000 M3 by the end of 2017? Even if they had all manufacturing lines installed and parts on hand by mid July 2017, there would still be months of debugging to get through before the first saleable vehicles could be produced. Probably why those manufacturing execs quit. They were sick of arguing reality vs “vision” with Musk.

    1. tftf says:

      Completely agree, see my comments above.

  36. LOL says:

    Awfully large pile of money are Tesla goona need to bring all these promises to life, a pile similar to Egyptian Pyramid, should add some gold ornaments.. If it keeps on at this pace, Model Y is to hit the road much much sooner than anticipated.

  37. TomArt says:

    This also puts the lid on any hopes people have had for changes to the trunk, front facia or dashboard…since the drivetrain is already production-ready and the rest of the design is almost finished…

    1. Phr≡d says:

      no part II, I’ll hold my breath (already blue)
      i.e., I don’t agree, but that’s pretty obvious, right?

  38. Brian says:

    “Of the Model 3 reservations to date, 93% of the consumers had never “interacted” with Tesla before.”

    I would be interested to see % with previous “interaction” vs current owners, and what that difference is.

    Also wondering what they count as “interacted”- for example, I am not a current owner and did reserve a model 3, but I have been on their email list for a while, and did a test drive of an S last year, so I know they already had my info stored. Does either or both of those count as “interacted”?