Tesla Reports Q3 Sales: Model 3 Sales/Production Miss Mark
Tesla has put out its end-of-quarter results for Q3’s sales and production – the only time (outside of an earnings call) when we get any hard data from the company on the metrics.
And while normally the focus is on the net amount of cumulative global total sales, this time…it’s all about the Model 3. So, lets get to it!
- Tesla Model S – 14,065
- Tesla Model X – 11,865
- Tesla Model 3 – 220
- Total Q3 deliveries: 26,150
If one might recall, Tesla CEO Musk estimated that the company expected to produce 100 cars in August and “above” 1,500 in September.
A number that was re-iterated during Tesla’s Q2 earnings report:
“Based on our preparedness at this time, we are confident we can produce just over 1,500 vehicles in Q3, and achieve a run rate of 5,000 vehicles per week by the end of 2017. We also continue to plan on increasing Model 3 production to 10,000 vehicles per week at some point in 2018. “
In the end, Tesla reported they built 260 Model 3s during Q3, about 1,400 light.
“Model 3 production was less than anticipated due to production bottlenecks. Although the vast majority of manufacturing subsystems at both our California car plant and our Nevada Gigafactory are able to operate at high rate, a handful have taken longer to activate than expected.”
The company did take a rare moment to explain that the production shortfall was not a serious issue going forward:
“It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain. We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near-term.”
Overall Tesla deliveries were indeed at a higher rate of the first half (as guided earlier).
2017 quarterly numbers:
- Q1 2017: 25,051
- Q2 2017: 22,026
- Q3 2017: 26,150
- YTD total: 73,227
Q3’s result was slightly higher than a year ago (+4.5%). The company also guided that they “now expect to exceed that (H1 results) by several thousand vehicles”, although estimates had already put the 2017 number at north of 100,000 units.
“In total, we expect to deliver about 100,000 Model S and X vehicles in 2017, which would be a 31% increase over 2016.”
Interestingly, Tesla produced less cars than it sold in Q3, which underlines what we had been seeing in July and August, as a focus on selling built inventory seemed to be in play. In Q3, 25,336 vehicles were built, some 800 less than were sold.
Tesla’s statement on the Q3 results:
ALO ALTO, Calif., Oct. 02, 2017 (GLOBE NEWSWIRE) — In Q3, Tesla delivered 26,150 vehicles, of which 14,065 were Model S, 11,865 were Model X, and 220 were Model 3. This was our all-time best quarter for Model S and X deliveries, representing a 4.5% increase over Q3 2016, our previous best quarter, and a 17.7% increase over Q2 2017.
We had previously indicated that second half Model S and X deliveries would likely exceed first half deliveries of 47,077, but we now expect to exceed that by several thousand vehicles. In total, we expect to deliver about 100,000 Model S and X vehicles in 2017, which would be a 31% increase over 2016.
In addition to Q3 deliveries, about 4,820 Model S and X vehicles were in transit to customers at the end of the quarter. These will be counted as deliveries in Q4 2017.
Q3 production totaled 25,336 vehicles, with 260 of them being Model 3. Model 3 production was less than anticipated due to production bottlenecks. Although the vast majority of manufacturing subsystems at both our California car plant and our Nevada Gigafactory are able to operate at high rate, a handful have taken longer to activate than expected.
It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain. We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near-term.
Our delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct. Final numbers could vary by up to 0.5%. Tesla vehicle deliveries represent only one measure of the company’s financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.