Which doesn't mean they won't get there eventually. A project like this isn't going to happen overnight anyway. And the market seems to value Tesla as if they'll eventually sell multiple millions of cars per year, so it's not irrational to make business decisions with that kind of end state in mind.
Most people who understand how difficult it is to produce a new line of cars, or have been listening closely to what Elon has been saying pretty much expected that ramping up production would be hard and Tesla would miss their goals many times. Tesla has never delivered a car on time. But there is enormous demand for this car and they will eventually make it work. At the current run rate they are already able to produce around 100,000 Model 3 per year, and are ramping up quickly
Tesla is severely supply constrained. Wait times in some areas is one year. They could easily sell 3-4 million this year if they had the supply, and this is before their $25k car which should be available by 2025.
Tesla has a history of shipping high-margin cars for as long as they can before shipping the base model. So no, no one should expect those cars to be rolling off the line by then.
On one hand, missing stated production timelines is not great.
On the other hand, people ought to be used to Elon Time by now. That'd be a problem if the other car manufacturers were closer to catching up with Tesla, but it doesn't seem like that's the case.
They did not miss their sales goal, but their delivery goal. Tesla cars are sold when they are produced, but they only book them, if they are delivered. Which takes time, as the car has to be physically moved. If they are moved outside of the US, several weeks of transport times add to it.
I think they're going to be dealing with the slow ramp up that Tesla had for years before hitting mass production. Maybe they will release first, but at a decent volume? I'm skeptical.
Then again Tesla is well known for missing deadlines too!
Tesla was cash flow positive in November and will probably turn profitable sometime in 2013. It's currently got way more reservations than production capacity, although production capacity is already at the stated 2013 goal of 20,000 cars per year.
Presumably production is still being scaled up, since Tesla is still planning and opening up stores all over the US and doing this without scaling production would just create unmet demand. The level of vitrol from some commenters in this thread is unwarranted.
His point was that the supply chain is there and working well. Tesla has a non-trivial amount of work to do to be able to catch up to those sorts of production numbers.
When you read through the announcement and you realize that this is a company that even if it doubled it's current production rate it would still have orders for the close to a year's production, then you have got to pause and be amazed.
How many Model 3s could Tesla produce at its current facilities? 7,000? 10,000? 15,000? It wouldn't be enough to remotely satisfy the demand.
Truth is that once delivery picks up, more people will start to order since currently people like me think it's pointless to order a car that you would have to wait a year to get and that - in most parts of the world - you can actually not order yet. The orders are likely to increase proportionate to the production capacity as Model 3 will be made available around the world.
This company could build 3 Giga Factories around the world that each produce 10,000 Model 3s per week and demand would still not be met. Heck, they could have 10 Giga Factories and they might still not satisfy demand for Model 3.
And then there is the future demand for Model Y and - once they get economy of scale and battery prices go down a bit - demand for cheaper, smaller cars.
All this demand could be met by other car manufacturers if they too produced long range EVs of similar or better quality than combustion engine cars. But no-one does and no-one will for an other year. Don't say Nissan Leaf; it's not long range. And when they finally do, in 2-3 years or so, are you going to take a chance on one of the first competitive EVs from VW, Mercedes, BMW, Ford, General Motors, Hyundai, Fiat, Toyota or Mazda or are you just gonna stick with Tesla, which by then comes with even better specs than today?
Tesla is the Apple of the car world. There is still room for other producers to make the Android cars that spend 3-4 year playing the catch up game of being one-two models behind in specs, and then maybe finally catch up in 5-10 years. But Tesla will get the better customers and the fat margins if the traditionalists don't hurry. And hurry a lot.
Wow - That sounds like a massive logistical efficiency failure.
I could even see people tolerating higher prices (as it is a Tesla, etc) - but that long of a delay is insane. I wonder how many Tesla owners regret their purchase after experiencing a crazy-ass long delay like that.
To be clear: I want Tesla to succeed. However I am also a realist - they have a lot of PR issues that would sink them if they were for example Ford/Chevy/BMW/Mercedes/Audi/etc.
I think people are assuming that this prioritization is going to cause way more delays than it really will.
There are about 120,000 Tesla owners out there right now. Maybe 130,000 by now, my facts are slightly out of date.
How many of those will be reserving a Model 3? These are people who 1) already have a car 2) which is still pretty new, since most Teslas on the road have been sold in the past couple of years 3) are now used to driving a large, powerful, luxurious car.
Why would they be buying a Model 3? It'll either be because some other car needs replacing at the right time, or they need an extra car, or they don't like the Model S and want something smaller. I don't think that's going to make up a huge proportion of the current owners.
I'd guess a few thousand at most will be reserving a Model 3. That's going to push other people's deliveries back by, what, a month or two? When the wait time is already a year and a half for the first person in line, I don't see this making much of a difference.
If Tesla can't meet their production schedule, many of those pre-orders will evaporate. Tesla now has to get a huge factory up and running, and then learn to run it cheaply. That's not easy. Fast, cheap, good - pick two. My guess is they'll be a little late with the new cars, they'll be OK, and their manufacturing cost per unit will be higher than expected.
Which doesn't mean they won't get there eventually. A project like this isn't going to happen overnight anyway. And the market seems to value Tesla as if they'll eventually sell multiple millions of cars per year, so it's not irrational to make business decisions with that kind of end state in mind.
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