Tesla Model S Sales China – 500 In September, Over 2,800 YTD

NOV 9 2014 BY ERIC LOVEDAY 45

The numbers are in…

Tesla Motors had expected China to be a strong market for the Model S and the latest sales figures mostly support the automaker’s expectations.

China has effectively jumped into third place worldwide in Model S sales volume for 2014, with deliveries only just starting there 6 months ago.

Aside from the U.S. and Norway, China now soundly stands in 3rd with YTD Model S sales eclipsing 2,800 units through the end of September.  In September, an estimated 500 Model S EVs were sold in China.

That 500-unit figure seems to be approximately what Tesla sells monthly in China.  It’s been above and below that mark since the Model S’ introduction there back in late April, but with 2,849 sold YTD (April 22 through end of September), sales average out to approximately 500 per month.

That number is going to have to jump considerably this month, and to end out the year to hit Tesla’s full year projections as the company has indicated Asia could the largest market for Tesla for year’s end.

Tesla Motors Shifted Its Attention To China This Summer

Tesla Motors Shifted Its Attention To China This Summer

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45 Comments on "Tesla Model S Sales China – 500 In September, Over 2,800 YTD"

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Benz

The highest sales figures of the Tesla Model S will come from the US, both in 2014 and in 2015. That has got to do with the level of Supercharger expansion (currently much more in the US than in China). The US market is much better prepared for Tesla Model S sales than China currently is. Although, that might change in 2016 or 2017. Anyway, it’s critically important for Tesla Motors to do well in the US (and in California the first place).

Mikael

Rich people in China go by flight and/or very fast trains rather than driving when going for a long distance.
So there is need for a full covering network to get a lot of sales in China.

I think you meant “So there is NO need for a full covering network to get a lot of sales in China.”

Phr3d

Going there for Free is pretty damned convincing no matter What continent, and Tesla is installing SC as fast as the guv’m’t allows.

I see US installation suffering actually (vs China), as sales in places without SC are none-too-good (good ol’ chicken-egg effect). Arguably, adding the D to the P60 will help in the snow belt regardless of no SC.. oops, cancelled.. still waiting for the X in, ahem, the Rest of the Story.

Mark B. Spiegel
I believe that your year-to-date China sales estimate is incorrect. If you go to p.20 of the new 10-Q you can see that year-to-date China revenue through September totaled $342.8 million. Keeping in mind that Chinese sales revenue includes the $40,000 per car import duty (yes, it has been verified with the company that this is booked as revenue) and thus using an average price per car of $145,000 (taking Tesla’s $105,000 ASP and adding to it the import duty) it would imply that total YTD China sales for Tesla have been only 2364 cars. Furthermore, it appears that a number of these sales may have been to “wholesale buyers” (albeit, paying full retail price) who had hoped to mark them up and flip them to end users but have so far been unsuccessful in doing so. (See the scores of on-line listings on Chinese web sites.) In other words, there’s a reason why in the Q2 conference call Musk was saying that he expected as much as 40% of 2015 sales to be in Asia while in last week’s Q3 call he did everything possible to downplay the company’s potential success in that market, and in the new 10-Q… Read more »
sven

Good info. Thanks for digging it out.

Chris O

No doubt Tesla’s market cap has incorporated way too much the over the top successful execution of future products. As demand goes: so far Tesla seems to be selling whatever it can make, regardless of regional distribution of deliveries over markets that are still developing so questioning demand doesn’t seem particularly effective strategy for shorters at this stage.

The thing that probably should have investors somewhat worried is the trouble it’s having so far in successfully executing it’s relatively simple (because largely based on an existing product)next product: Model X.

Mark B. Spiegel

It’s simply false that Tesla is “selling everything it can make.” (Yes, I’m calling Musk a liar.) There’s now a six-week delivery time for a custom-ordered S85– the shortest it has ever been. If the company were suffering from a combination of “production issues” and “more demand than it can handle,” that delivery time would be LENGTHENING. Although Musk may be “the smartest guy in the room,” he seems not to realize that one need not be a rocket scientist to logically analyze his outlandish statements.

Chris O

Meanwhile Tesla is doing whatever it can to ramp up production for cars it has no demand for? Someone is definitely a liar here but I’m pretty sure it’s not Elon Musk.

Can you please explain how much is the ramp up? Before July shutdown, the production rate was 800 cars per week. They messed up the upgrade, likely intentionally. Have they ramped up to at least 1000 per week by now? Why didn’t Tesla answer this question in the conf call? If it is 1000/week now, they could produce 13000 in Q4, and easily deliver 13K+ cars in Q4 (include prior inventory).

So, please show your facts/numbers instead of repeating false information.

Daniel

6 week delivery time on The model S P85D yes. But for a standard custom ordered Model S 85 to Sweden is expected to be delivered in March/April. As told by a sales representative at a Telsa Store here.

Anton Wahlman

Maybe they first need to scramble together at least 12 orders until it’s economical to transport them all the way there?

Bonaire

There are cars on the lot at my local Tesla sales and service center. Fewer this week than last but they started the quarter with at least 8 or 9 there in early October. Sold some of them by now. In Chicago they are offering discounts on lot cars.

Mike I

These are likely demo or loaner cars that don’t have Autopilot hardware. Of course they should be discounted.

Mike I

“That number is going to have to jump considerably this month, and to end out the year as Tesla has said Asia will be the largest market for the Model S in the 4th quarter.”

Don’t forget that Australia will launch in the 4th quarter and they have a lot of pent-up demand. If you read the Australia/New Zealand section of Tesla Motors Club, you will see that many people are reporting that their car’s status is changing to “In Transit from the Factory”. It looks like Tesla is pushing a large percentage of the Australia orders through the factory now so that they can make the Pacific crossing and be delivered in December. The few Australia Signature Model S cars that were built before the factory re-tooling were actually re-built so that they would include the Autopilot hardware.

DaveMart
‘Tesla Motors had expected China to be a strong market for the Model S and the latest sales figures mostly support the automaker’s expectations.’ They do? How? Originally Tesla was talking about three legs to the stool, then Europe got downgraded to 20% of the market, now Musk in his Q & A for the 3rd quarter was talking in terms of ‘only just getting going’ and in the phase of ‘building the foundations and repeatedly avoided answering how many he expected to sell there in the 4th quarter. He did however say that he expected growth there from whatever level it manages to hit this year to climb by around 13% in each of the next two years. So if sales for the first 12 months turn out to be at about the rate they have been, then the 7,200 cars in the first year might grow to around 9,200 by the third year. That is European type levels of sales, and way under the rate in the US. Musk however was keen to emphasise how strong they would be even if they sold none in China, which would not seem to indicate that he sees much prospect of… Read more »
Chris O

Hmmm, the thing that Elon Musk keeps stressing is ” We have more demand than we can really address and there is a lot of things, levers we could pull to increase that demand which we’re not pulling. So, it’s really not an issue”.

Regardless of any real or imagined changes in regional distribution that really says that Tesla is putting whatever production capacity it has invested in to optimal use.

Sounds like Tesla is doing just fine.

DaveMart

My link to the transcript seems to have disappeared with the mod edit

It was:
http://seekingalpha.com/article/2647055-tesla-motors-tsla-ceo-elon-musk-on-q3-2014-results-earnings-call-transcript?part=single

There is no recent support guidance from Tesla that ‘ the company has indicated Asia could the largest market for Tesla for year’s end.’

as they have progressively downgraded expectations for Asia, or more particularly China.

So that towards the start of the Q & A we have:

‘just over half of those are North America and Europe and Asia are the remaining half.’

The transcript has clearly missed a comma, and it should read:

‘just over half of those are North America, and Europe and Asia are the remaining half.’

Tesla argue that they are fine for orders anyway, and are demand constrained, not demand, but clearly see North America as over 50% of their market going forward and are downplaying the importance of Chinese sales.

Hey Dave,

Tesla has guided sales for 2015 during the most recent shareholder Q&A…those are the splits you are listing above and below…not for 2014 year end.

The guidance for the end of the year/Q4 was/is heavily weighted away from North America in Asia and Europe…and still is to this day. Tesla has never updated its sales mix forecasts for the end of 2014 during this quarter to our knowledge. If you can guide us to ANY specific quote from Tesla referring to the sales split for the end of 2014 we would be happy to adjust. I don’t believe any such quote exists.

Here is the quote:

“For the year (2013), Model S was the top selling vehicle in North America among comparably priced cars. Nonetheless, we believe there is room to improve in 2014 as we complete the Supercharger network and enable vehicle service almost anywhere in North America. The potential in Europe and Asia is even more significant. Towards the end of the year, we expect sales in those regions combined to be almost twice that of North America.”

Feb 20th Shareholder letter

DaveMart

@Jay:

You are quoting a February presser in preference to a 5th of November Q & A as guidance for the year end?

That makes absolutely no sense whatsoever

I’ve detailed the how Tesla’s expectations for sales outside of North American have been progressively downgraded.

Sure, there will be some pickup perhaps as they pushed through orders in NA preferentially to try to hit target for quarter 3, but for instance in their biggest by far European market, Norway, for the first month of the last quarter, October, they sold 36 units.

How many people in snowy Norway are going to be keen on a 2WD Tesla before the year’s end?
Anyone who can cancel will be cancelling.

‘Towards the end of the year, we expect sales in those regions combined to be almost twice that of North America.”.

It didn’t happen.

I’m not debating, your question above to the author was “Where did you get that from?” and I provided the answer. A 2015 estimate is just that, it does not speak to the nuances and production idiosyncrasies as planned for the end of 2014. Those numbers Musk gave last week will be repeated verbatim throughout 2015, or until such a time as to when it is updated. — I will say however, that: Sales allocations/planning is put in motion many, many months in advance…especially in relation to a one plant/one car OEM. In the same way I can tell you right now that GM has a 23 week lead time to delivery on any new orders placed out of production for the Spark EV in America…that’s 5.5 months. So an order placed today destined for the US, will not be reported (at the earliest) until May of 2015. — Also as a matter of known information in regards to production and sales: Tesla knew and disclosed in Q1 that the start of RHD/Asia production would happen in late spring/early summer – which would lead into a planned mid summer shutdown. They also disclosed to US persons that would be ordering… Read more »
Mark B. Spiegel

Jay,

You need to read the latest 10-Q:

>>we expect our long-term sales outside of North America will increase to almost half of our worldwide automotive sales.<<

"Long-term almost half"? This is a SERIOUS downgrade of the company's international prospects.
http://www.sec.gov/Archives/edgar/data/1318605/000119312514403635/d812482d10q.htm

Hey Mark, In no way I am speculated or commenting on what the current/ongoing demand is…I am only commenting on what Tesla’s stated production plan was/is for year-end 2014 and what has most recently been produced in relation to international deliveries. There has been no commentary on my part, only the disclosure of realized and ongoing occurrences as it relates to productions and its subsequent affect on deliveries during a particular period. Tesla could only sell 25% of all sales in 2015 to Europe and Asia, but they could also produce all those in the same quarter if they (unwisely) chose to do so…making that particular quarter 100% foreign deliveries. Obviously that is not how it happens over the course of a year, but it does happen to some degree on the smaller subset of a single quarter. Taken another way, if Tesla guided to sell 1600 cars in a year and also guides to a 50/25/25 split for US, Asia and Europe, it will never go anything like 200/100/100 evenly for each of the 4 quarters in 2015, but many (if not all) of the quarters would have an overweight in one of the 3 regions. — My point… Read more »
Mark B. Spiegel

“…well, I should have known better than to comment at all on Tesla. I consider myself duly punished. /lesson learned”

Lol!

Phr3d

well put, Jay, and thanks as always for your uncommonly evenhanded approach to many things tumultuous..

if you Want to find fault, you can absolutely find it
if you Want to find fortuity, you can absolutely find it.

and as long as we all admit this basic truth and NOT feel the need to see the opposite viewpoint as neuroses or worse, Dangerous..

but that is no longer allowed in many venues (you listenin’ D.C.?)

DaveMart

‘I’m not debating, your question above to the author was “Where did you get that from?” and I provided the answer.’

Fair enough.

It certainly draws attention to their epic miss.

‘Your statement of “clearly see North America as over 50% of their market going forward” has not yet born itself out in the production of vehicles thus far for the 4th quarter.’

That was not my statement, but theirs which I have sourced.

DaveMart

BTW, if Tesla does hit their declared target for the year of European and Chinese sales being twice North American, that means that out of the 11,000 they reckon they will deliver in the third quarter, 3,666 will go to North American, which is a pretty lousy quarter, leaving aside the improbability of their boosting China from the current 500/month or 1,500 a quarter, or the limpness of European sales.

Why so negative on Tesla in North America? 🙂

Bonaire

European sales for October are quite low. I doubt they hit the 33k new guidance.

DaveMart

Dire, actually.
http://ev-sales.blogspot.co.uk/

Piecing it together, they seem to have sold around 50 or so in the UK from SMMT figures which don’t break EVs out by brand, maybe the same in Germany as they don’t make it into the top five EV’s and are beaten by the i8 with 75 sales, nothing to speak of in France, Italy and Spain, 27 in the Netherlands and 36 in Norway.

Well, there are two months left in 2014 for Chinese and European sales to hit double North American sales, as per last year’s guidance! 🙂

DaveMart

I’m guessing there will be another couple of thousand off that, so something like 31k.

DaveMart

The Tesla projected sales split started out at:

33% NA, 33% Asia, 33% Europe

That was amended to:

40% NA 40% Asia 20% Europe

And in the Q & A became:

50% NA 25% Asia 25% Europe

Greg

Do you mean 50% NA and 50% (Asia+Europe), based on the Q and A? Or do you have info that Tesla is saying that Asia and Europe will be about equal?

DaveMart
That is just from the Q & A. If you read through the whole thing the point crops up in various ways in different parts, with Tesla as usual keen to tell us as much as possible about their aspirations and as little as possible about what is actually happening. The very large downgrading of China is clear though, as from whatever level they reach this year they project only 13% growth in each of the next two years, whilst projecting 50% growth in total, so wherever they are they expect them to shrink proportionately and comprise an ever smaller share of sales. As my interpretation rather than a direct read off of what Tesla has said which I have tried to make clear so far in this thread, I offer the following: They are projecting over 50% for NA from the Model S. The home of the SUV is the US, and so it would seem to me that this will skew sales even more to NA. In Europe they talked of raising prices to make up for the strength of the dollar. The rise in the currency is around 7-8%, which will hit sales, already poor, in Europe… Read more »
DaveMart

The ‘this’ I am referring to likely to skew sales further to the US is the Model X SUV, whenever it arrives.

YanMing_sv

Yes, as Musk said, Tesla is working on (not yet) getting into the list of cars which exempted from paying sale tax. All the Chinese made EV and PHEV are in that list now.

Bonaire

Greg, at this point they have said just about everything. Just pick one as your favorite.

ffbj

So I am right unless I am wrong since one of the variables changed. Good way to always be right.

jmac

Both GM and Volkswagen have sold cars on Alibaba.

Someone claimed that Tesla selling cars on-line in China was an act of desperation.

Apparently VW and GM must also be ‘desperate’ if they are also advertising on Alibaba.

Tesla normally sells through its on line website. So, this hilarious, accusation about Tesla selling on line through Alibaba is just more non-sense from Teslaphobes.

——————————————–

“Tesla is not the first car company to capitalize on Alibaba’s ubiquity in Chinese retail. General Motors and Volkswagen AG have launched similar marketing campaigns on Alibaba’s sales platforms.”

http://kungpao.tv/tesla-motors-to-sell-model-s-on-alibabas-tmall-on-singles-day/

DaveMart

Tesla claims they only build to order, GM and VW don’t, so their selling through Alibaba is irrelevant.

jmac

If you bothered to read the reference article, Tesla is “taking orders” and deposits through Alibaba, not selling ready ready made cars.

Even if they were selling generic Model S sedans on Alibaba, what difference does it make ?

There is no law that says Tesla must sell cars on line. They can sell them through dealerships if they choose to do so.

DaveMart

Whatever.
I can’t be bothered with the mystery of Tesla, China, and the disappearing cars which don’t get registered as on the road.

Bonaire

Five day delivery of specific models. Sounds ready made.

Tom Barron

The only reason for this debate is share price. Anyone who bought Tesla shares for the long haul is not interested in these dogfights. Neither are the hoards of satisfied Tesla owners.

No… The only reason for these debates is to benefit short term investors trying to create instability in the stock price and in turn create an environment of distrust towards Tesla which can only benefit the established automotive companies. In effect those hysterical detractors are simply puppets who have no control over their own thoughts.

DaveMart

The reason for the debate is to work out how Tesla is actually doing, and work out if there forecasts are matched by performance.

Eurocentric

you are really too much supportive of Tesla . I quote you :
“Tesla Motors had expected China to be a strong market for the Model S and the latest sales figures mostly support the automaker’s expectations”

I do not find these figures fantastic , they are rather low and do not justify your euphoria .