Featured Tesla needs to Catch up

My speculation is Tesla held cars instead of rushing to deliver to avoid busting the 200,000 EV trigger until June. There are rumors of 8,000 Teslas parked somewhere.

Bob Wilson

 

A good percentage of remaining reservations are overseas. They are prioritizing American deliveries first. Makes sense from a profitability standpoint.

 

No, they didn’t disappear.
Many are overseas, where Tesla is not sending any cars yet.
The Tesla Model 3 that can be delivered in 1-3 months is the performance model. If you want the short range battery, that isn’t being built until the beginning of next year.

If Tesla builds an average of 5000/week, that would be 65,000 over the next 3 months.

As of the beginning of July they had 423,000 reservations.
So if half of the preorders are overseas (other than Canada). That takes us to 212,000
I am guessing 120,000 are for the short range battery, bringing us to about 90,000 reservations.
If Tesla doesn’t get additional orders (they are no longer taking reservations) and they average 7,000 cars/week in the 4th quarter they can clear their US reservations for the long range battery this year.
Since they are accepting orders, my guess is they will clear US reservations of all long range batteries in the first quarter.

 

Before June 1st, sales outside of the USA would have a higher priority to minimize exceeding 200,000 sales.

Bob Wilson

 

This may be the case with sales of the S and X. Other than a couple thousand sent to Canada, no Model 3s have been delivered to customers outside the USA.

 

This is likely the case of the model 3 in may and June being shipped to Canada, and stock piling of all us tesla's during june to get registered in july instead of june.

Model S&X are demand not production constrained. Some personel were switched to the model 3 line, delaying some shipments, but this should all be made up this month. The new tarrifs may reduce total S&X sales (price increases outside the US) as may canibalization by the model 3, but these will probably be around 2K/week. 50K in H2/2018 with probably 20K going to US customers.

My guess is 100K long range model 3 are delivered in the US in H2/2018 or a total of 120K. This will make the model 3 one of the best selling cars in the US this year, and the more affordable standard range (probably asp of $46K ($35K for the car, $5K premium package, $5K autopilot, $1K delivery) model 3 won't be shipping until next year.

On the configurator, the $68K+ P version will jump you to the front of the line ahead of all the non P versions. The RWD long range pack is 1-3 months. Dual motor non performance is 2-4 months. My guess is in about 3 months they will have the Dual motor down, and P then D then rwd long range will get priority in that order. When production exceeds all those orders only then will they allow the standard pack or standard, non premium interior.

 

from the configuration page, it still just means you can order non-small traction pack versions. Once that que clears, the minimalist version starts. The constipation is starting to soften

Sorry for the late response .... & not the most recent example - just the first read Google brought up.
Tesla actually made money last quarter, in part by selling pollution credits | Autoweek

 

Toyota sold 3,546 primes in 17
Tesla say’s they delivered 4,360 model 3’s in 17

Who err, where are the 120,000 people that are going to buy the 75k$ model 3’s in 18?

The average age of automobiles in the US is 12
TSLA is building 3’s in a Tent, let’s hope they don’t get Stormy Weather

 

The tent is not really a tent it's a prefab building, not a good thing mind you. It is hopefully a temporary fix to needing more space while they rearange the lines inside the factory.

The Long range premium is $35K + $9K battery + $5K premium package + $1K destination = $50K, but most will also choose autopilot for $5K. The $75K+ is the performance model 0-60 in about 3.3 seconds. You need to order that to get to the front of the line. Dual is $4K more than the rwd.

So far tesla has sold 54K model 3s, all of them the rwd long range premium, some went to Canada.
How Many Tesla Model 3 Cars Have Been Made?

How will they sell the others this year in the US? They have a backlog of 400,000 cars many of them wanting standard packs, but recieved 7000 new orders last week. The question is not if they can sell them, but if the factory can continue to make them at this rate.

 

The reservations are still there. Tesla expects to fill those that want the higher end trims soon enough that they opened up public ordering for those trims.

Factoring differences in vehicle codes, I doubt any Model 3 has been shipped outside of North America at this time.

 

yea he knows -


but if tesla lays out tons more cash for brick & mortar - trolls can troll about how bad all of that cash spending is "failure! failure! it won't be ling now!" And if the building you can throw up the fastest due to huge demand - but it cost less, you can try & get drama from that.

.

 

I've done manufacturing consulting, including some with the old toyota experts. I can't see any way shape or form the "temporary building" (who knows it may be there for years) is a good thing. It did help as a stop gap to tesla's trouble ramping production.

Deming was one of the inventors of the wheel - lean production. US car manufacturers didn't buy in until toyota used these ideas and created the toyota production system. Tesla seemed to have thrown away a lot of those lessons when it built the lines for the model 3. Its not too bad though. They have been slowly removing the bad uses of automation, using people where they are better than machines, and cutting labor per car and waste. They have a long way to go.

My opinion is the tent, or this other assembly line, is a bad idea if you want to do lean production, improve quality, and lower costs. The reason it is probably a good idea from a corporate point of view is that there is only a year left for the $7500 then $3750 tax break, and they wanted to up production in the short term even if it hurts a little in the medium term. Tesla will also probably need to do a capital raise in the first half of next year, and higher model 3 sales before that will make it cost less. Tesla has done a lot of things right, but the tent/temporary building isn't one of them. If management doesn't fix it then those temporary things tend to become permanent, but I think the management team has the skills to get rid of it by 2021 and have a better environment.

My guess is if tesla hires some more manufacturing experts, outsources seats, pays for a much better paint shop, then they can get production up to 400K units next year in fremont without the tent while cutting cost per car and improving quality.

 

"I can't see any way shape or form the "temporary building" (who knows it may be there for years) is a good thing. It did help as a stop gap to tesla's trouble ramping production."

You've answered your own question, production capacity. We used to say, GOOD, FAST, CHEAP . . . pick two. The temporary structure is FAST and CHEAP but lacks important features of a permanent structure such as plumbing and HVAC efficiency.
​

Deming was one of the inventors of the wheel - lean production modern quality systems. US car manufacturers didn't buy in until toyota used these ideas and created the toyota production system. Tesla seemed to have thrown away a lot of those lessons when it built the lines for the model 3. . . .

Quality control systems and the Toyota "just in time" production are human artifacts that have to be taught and followed with supervisor support. Management sets the goals but the supervisors have to make it work. It is not something defined by the property and capital equipment but can be accomplished anywhere.​

. . . The reason it is probably a good idea from a corporate point of view is that there is only a year left for the $7500 then $3750 tax break, and they wanted to up production in the short term even if it hurts a little in the medium term. . . .

In order for a quality control system to work, it must have management support. The recent lost of a Tesla executive in charge of quality control is the largest risk until we see if he is replaced with someone better. I was faced with a similar choice of an employee who decided he was not going to follow the quality standards and QA rightfully rejected his. He was shocked when I stood by QA and he had to correct the problem even though he claimed,"It works." Working is not enough.
​

My guess is if tesla hires some more manufacturing experts, outsources seats, pays for a much better paint shop, then they can get production up to 400K units next year in Fremont without the tent while cutting cost per car and improving quality.

I don't work for Tesla but see the temporary building and working assembly line allowing tweaks and tuning of the existing lines. My understanding is Tesla has four assembly lines making Model 3. So they can afford to shutdown one for a couple of days to improve the processes and rotate these into the other lines. They can keep their staff busy by beefing up and relief for the other production lines. ​

We agree a lot but I'm not part of their organization. I see the temporary facility and 4th line as being a way to more rapidly tune the assembly lines paying much greater long-term efficiencies and profit margins.

Bob Wilson

 

"17" as in all of 2017? Where are you getting these numbers?

 

Numbers of US deliveries from 2017 are wrong but not that far off
Monthly Plug-In Sales Scorecard
1772 Model 3's delivered in the US in 2017, none delivered to non-US customers. This was really a beta stage of production, with cars going to employees or friends of tesla
20,932 Prius primes sold to US customers in 2017. They would have sold more but availability was low, and Japan got higher priority.

Q1 of 2018 represents the first tesla production of model 3's to real customers and there were manufacturing problems. In the first half ot 2018 there were 24,367 model 3s delivered to US customers and some more delivered to canadian customers, with many more built that have been delivered in July.

We will know at the beginning of january how many tesla has sold in 2018, but if they can make over 100,000 (about 4000/week) model 2s, it looks like they can sell them all in the US. They have already delivered more model 44K BEVs in the first half of 2018 in the US, and anouther 20K outside the US.

 

why mention 18 if only 17 fits your argument.

 

ummm, because you short the stock, and you are losing your shirt?

.

 

There is one similar to this at a shopping center near me. The ads are a bit bigger. But lots of people walk by them since they are at a couple of very close parking spots. Everyone sees that it is a FREE charging station and there are almost always people charging their cars. Compared to paying rent for a big billboard the cost of the electricity is probably very cheap. And the "rent" on the real estate might be really cheap since they can claim it help bring in business.

Mike

 

July numbers were a blow out as they were supposed to be, but came in a little below my estimates.
July 2018 Plug-In Electric Vehicle Sales Report Card

model 3 14,250
model S 1,200
model X 1,325

Total tesla deliveries in the US was 16,775 while I expected them with the June inventory build to hit 18,000. For reference the number 2 plug-in for July was the prime with 1984 units. The shortfall compared to my estimate was in the model 3, and likely caused by a slow down at the beginning of the month after the rush in the last week in june. Still prius family of cars (prius liftback, prime, c, left over v) sold 7265 in July, while the model 3 alone did 96% better.

 

But is this sustainable?

According to this Tesla using workers from out of state, solar division, to build cars

"Electric vehicle maker Tesla is taking urgent steps to add workers to its vehicle and battery plants, including flying employees in from out of state and putting them up in hotels, and temporarily enlisting employees from unrelated divisions.
<snip>
Tesla acknowledged the practice, and said it has also done this in the past, especially in big production pushes near the ends of quarters.
<snip>
But this time, it's a bit different, current and former employees say. Tesla is not only flying workers in from out of state, as it has in the past, but is also enlisting employees from its residential energy business to work on making cars in Fremont. Some were also routed to the Gigafactory in Sparks, Nevada, where it manufactures batteries."