Demand

[30seconds]

I believe that with information I got during the last weekend "Tesla Social" event I can bring some clarity to the often discussed issue of demo/loaner fleet and new car inventory.

During impromptu chat with sales personnel at my Store/Service Center I got unequivocal confirmation of something @dennis has been posting about for a while - that Tesla is shifting from the sales based exclusively on ordering individually optioned cars to a mixture of the above and new inventory sales. The new inventory cars are mostly located at the regional hubs and typically delivered to specific store within 2 weeks of the purchase. The real eye opener though was to what degree sales model shifted to the new inventories. I was very surprised by the answer, and had extensive discussion on this, but my source indicated that based on this particular store experience, which I was told is typical **at least** 50% of sales are from the new inventory.

So based on this info we can analyze new inventory in much more detail that was possible before.

Based on the snap shot provided below the new inventory at the end of Q3 was about 10k cars.

There were around 26K cars delivered in Q3, or about 2k cars per week. 50% of these deliveries, or roughly 1k cars per week were from the inventory. Assuming average (globally) in transit time of 4 weeks which corresponds to 4k inventory cars in transit, leaves about 6k of inventory cars available for sale, or, at 1k cars/week, a 6 weeks supply. For the perspective, this compares to an US average auto inventory of 10 weeks, i.e. MS/MX inventory is quite healthy.

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where is all the online inventory? seems like only a handful for sale

 

[dc_h]

shudder at the thought of a world where Toyota, Honda, GM, Ford and other car companies start using their millions of owners as sales people.

I think word of mouth is exactly how early Toyota and Datsun got started. I think they also use social media to try to influence opinion. What do you think about using social media to influence?

 

[drewg123]

where is all the online inventory? seems like only a handful for sale

Try Tesla Inventory It has ~10x the inventory of the 2 other search engines. I found a car there that was not on the other engines that my OA suggested to me the next day (and which I ordered on Sat).

Note that this is not the old Tesla Inventory Search, it is itanywhere,no.. Somehow the forum resolves the URL, and pulls the page title from there, and the similarities in the names is a bit confusing.

 

[drewg123]

The new inventory cars are mostly located at the regional hubs and typically delivered to specific store within 2 weeks of the purchase.

I just ordered a car like that this weekend. It was at what my OA called a "hub". It had a very new VIN, and AP2.5 HW and 50mi and was listed as inventory (not service loaner, demo, etc). I was told it would take 2-3 weeks to arrive.

What was interesting to me was that the hub is several states away (Alabama), and the shipping was free. However, if I did the "estimate shipping" thing on the car's page, then it would say it would cost $2K to ship.

 

[carlos123456]

I always look at the Model S/X production/demand like this: both are growing, but with different speed of growths.

Initially Tesla was clearly production constrained. However, Tesla's production rate in the past almost always experience sudden increase as they complete upgrades on their lines or whatever production rate "jumps" from time to time. Before 2015 or so, even after production jumps, it was still below the natural growth of demand. But sometime in 2015, they jumped temporarily over the naturally grown demand. Say production last month was at 500/week and demand was at 750/week for the Model S. Tesla completed a line upgrade and increased production rate to 1000/week from now on. But without incentives or other actions, it will take a while for demand to grow naturally to 1000/week. So they started the referral bonus and all sorts of other things. I guess those were still not enough to quickly lift demand to match production. Thus we saw Tesla building inventory cars just to discount them a bit to sell faster. This was most evident last Q3 when they sorted out Model X production (a big jump in production rate) so they started discounting inventory cars and tapped into the Model 3 reservation holders.

My guess is now they have a good match between production and demand so they ended the $1000 referral bonus.

I just wonder if Tesla really wants to go down the road of discounting the cars and into the entire negotiation game. My guess is that we will see something else as an owner incentive to self promote the Tesla brand and they are trying to come up with a way to do it without creating an abusive atmosphere as may have been perceived in the past.

 

[bonaire]

Finally you agree to common sense observation made long ago! Tesla carries inventory and the growing divide between production and sales isn't just demos and loaners but real inventory kept on separate lots. The only thing that surprises me in your post is the amount of inventory sales : over 50% is a lot!

This all started in 2014 - but is a larger scale, inventory management process now where cars can go to various "lots" including 3rd party holding lots (JP Logistics, Westside Group, Birmingham Hub) and various other locations like the Lathrop building which I reported here earlier in the Demand thread (I think?)

Model S inventory bloom looked like this for the last couple years (Vin # series is the X-axis). And this doesn't count Asia inventory (and Australia has only recently been visible). Notice 193xxx being 70%. But it comes and goes and I'm sure I am low on some of these counts with more recent 1000 numbers still yet to be grown into.

Model X is a little bit harder to do, but it's close to a similar style of graph.

 

[bonaire]

I just ordered a car like that this weekend. It was at what my OA called a "hub". It had a very new VIN, and AP2.5 HW and 50mi and was listed as inventory (not service loaner, demo, etc). I was told it would take 2-3 weeks to arrive.

What was interesting to me was that the hub is several states away (Alabama), and the shipping was free. However, if I did the "estimate shipping" thing on the car's page, then it would say it would cost $2K to ship.

That 2k is for "self directed" buying. The OA can waive that for you (or for anyone) to move an inventory vehicle this quarter. I would say some people have definitely paid that $2k without knowing that someone would "work with them". Some inventory showing Fremont holding location - still have a $2k transit fee charge even though they have not gone anywhere yet. That is a rough one to consider paying. Basically a double shipping fee from picking off their Fremont lot cars. They should offer a $2k discount for buying from inventory sitting about - not charge extra to get it.

 

[Peter Lucas]

Speaking about the loaners fleet, at the same last weekend's "Tesla Social" event, during the part of presentation that was focused on service improvements, I asked the question about loaners and how many loaner cars my SC needs to have in their fleet so I can expect to always have a Tesla loaner when I bring my car for service. I was told that currently my SC has 15 loaners in their fleet, and they need 35 to 40 loaners in order to provide 100% Tesla coverage. The question was answered by the SC manager, without missing a bit or any hesitation. The fact that he knew off the top of his head how many loaners they need to cover 100% of the demand for them tells me that the request to mother ship is either in or ready to go. So we should be ready for further increase of the loaner fleet, to the tune of several thousand cars, without succumbing to nagging concerns about demand.

The fact that your service center manager knew how many more Tesla's they needed to assure all customers had a Tesla during service does not necessarily mean that those Teslas will actually be delivered. The real question is: Is Tesla committed to providing all service customers with Tesla loaners? The San Diego service center loans out lots of Enterprise rental cars and shows no signs of changing that policy.

 

[dennis]

The fact that your service center manager knew how many more Tesla's they needed to assure all customers had a Tesla during service does not necessarily mean that those Teslas will actually be delivered. The real question is: Is Tesla committed to providing all service customers with Tesla loaners? The San Diego service center loans out lots of Enterprise rental cars and shows no signs of changing that policy.

My guess is they will try to limit the increase in service loaner inventory and dramatically increase the number of service requests satisfied by the mobile fleet. Tesla recently filled the position of Mobile Service Manager for my region.

 

[ValueAnalyst]

Model S and Model X design studios estimate December Delivery for new orders.

When should we expect this to change to January? What is normal?

 

[bonaire]

Model S and Model X design studios estimate December Delivery for new orders.

When should we expect this to change to January? What is normal?

To draw in orders for year end, I suspect they won't change that to January for a few more weeks. Even if they will eventually deliver in January. Some orders in other threads indicate that some were shown October delivery at order time and then switched to November/December once confirmation happened.

 

[kenliles]

^^
also, note they are ending the $1000 referral bonus Nov 1 (leaving the free SC in place only)

 

[bonaire]

Remember - a confirmed order is "locked in" even if they move back the delivery date after confirmation. The non-refundability of a confirmed order says you're not going anywhere (most likely).

 

[Spidy]

Model S and Model X design studios estimate December Delivery for new orders.

When should we expect this to change to January? What is normal?

It's not really a good demand metric anymore since Tesla started building significant amounts of inventory cars.

 

[FlatSix911]

October EV sales show that the Model S remains on top while the Model X drops to fifth place behind the Bolt, Volt and Prius
Monthly Plug-In Sales Scorecard

 

[Dutchie]

I have been working in a Tesla store for a couple of hours for the last few weekends. This a a back-up for the sales people for if potential owners have questions for real owners, then I would come in.
I can tell you that Tesla has nothing to worry about. It was always busy in the store. Even when it was 35 degrees outside and people should be at the beach, there were still lines of people eager to ask questions. There were plenty of people too depositing $1000 to be on the list for the Model 3. Tesla is in good shape. It has barely scratched the surface in regards to its potential.

 

[dhrivnak]

I have been working in a Tesla store for a couple of hours for the last few weekends. This a a back-up for the sales people for if potential owners have questions for real owners, then I would come in.
I can tell you that Tesla has nothing to worry about. It was always busy in the store. Even when it was 35 degrees outside and people should be at the beach, there were still lines of people eager to ask questions. There were plenty of people too depositing $1000 to be on the list for the Model 3. Tesla is in good shape. It has barely scratched the surface in regards to its potential.

Wow I would LOVE a gig like that. Too bad I am 190 miles from the closest Tesla place.

 

[FlatSix911]

Current data for YTD 2018 EV sales in the US market ...

 

[dhanson865]

3x as many Model 3 sold in the US so far this year than the Chevy Bolt. I guess the Bolt fans can stop crowing about how the Bolt was ahead in total units sold. That crossover should happen in July (may have already happened but we'll need to wait a few weeks to see the numbers on the board).

They'll probably focus on how it led the end of 2017 chart until their rear view mirror breaks.

The Model 3 to Bolt and Model 3 to Leaf ratios will continue to increase.

 

[oneday]

If Tesla can double deliveries in July that should put them in the top 10 best selling cars in the USA. Pretty exciting!