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How many general production cars before first Signature Model S for Europe?

Discussion in 'Model S: Ordering, Production, Delivery' started by linaser, Oct 13, 2012.

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Guess how many general production cars before first Signature Model S for Europe?

  1. 1000

    3 vote(s)
    7.9%
  2. 2000

    2 vote(s)
    5.3%
  3. 3000

    6 vote(s)
    15.8%
  4. 4000

    4 vote(s)
    10.5%
  5. 5000

    9 vote(s)
    23.7%
  6. 6000 or more

    14 vote(s)
    36.8%
  1. linaser

    linaser Member

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    Now, that Signature delivery in the U.S. is well underway, I'm staring to wonder, how many general production Model S vehicles will be manufactured, before Tesla starts producing Signature Model S cars for the European markets.

    We all know, that George Blankenship had stated late 2012 as the deadline for the first European Model S in his blog post in march 2011. Since then there was AFAIK no official statement or press release on how far this timeline was going to be pushed back into the future. My request on that, at the stores and with the European Tesla head office in the U.K., was answered with Q1/2013.

    Reading the posts here on the forum gave me the impression, that many other Signature reservation holders got the same response.

    An other interesting piece of information was revealed by Elon at the annual shareholder meeting on June 6th, where he stated, that homologation for the European markets would be one of the key targets for the following quarter.

    But I think, that more important and more accurate as on when we (the signature reservation holders in Europe) will get our cars is the question, how many general production cars will be made in Fremont, before the line switches to production of the European Model S.

    Because the guesstimates in the TMC forum seam to be astonishingly accurate I'd like to ask you:

    What do you think, how many general production Model S will be manufactured before Tesla starts making European Signature Model S cars?
     
  2. linaser

    linaser Member

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    Thanks to all those, who already have participated in the poll.

    It seams, that there are many who believe, that the Europeans will get their Signature Model S not before, a pretty big number of general production Model S are delivered in the U.S.. Can anybody share his/her thoughts on that?
     
  3. VolkerP

    VolkerP EU Model S P-37

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    Tesla badly needs revenue from general production Model S. The Sigs yield around $100k, but the $40k reservation was paid well in advance. General production cars will generate more cash.
    My vote is 3000. Tesla will deliver 1200 NA signatures, they announced to produce a total of up to 3200 cars this year. General production will continue Jan&Feb until EU signatures start being produced.
    Given the troubles with Canadian homologation, further delays of EU deliveries seem possible. They have their hands full.
     
  4. Brian H

    Brian H Banned

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    I don't think the line will 'switch' to EU Sigs. They will be batched or interspersed among US production
     
  5. linaser

    linaser Member

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    Do you really think, that Tesla would stall production for the European market even when they have successfully completed homologation, just to keep the $ 20m cash they got from us? Do you think Tesla needs cash so badly?

    Or do you even think, that they are reducing their efforts to complete EU homologation as quickly as possible to keep that money longer?

    Sure, there are lot of reasons, why Tesla needs more time to do these things. But my hopes are, that keeping the Signature payments longer is not part of that. If Tesla could at least acknowledge that officially, that would be great.
     
  6. Trnsl8r

    Trnsl8r Blue 85kwh since 12/8/12

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    If Canadian homologation is a challenge, then expect delays for EU with amber turn signals, some right hand steering, and 20+ different countries' regulations, etc. etc...
     
  7. Doug_G

    Doug_G Lead Moderator

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    Let's not jump to conclusions. There's no real information at this point; just that the approvals haven't been made yet. It could simply be a paperwork issue at Transport Canada for all we know.
     
  8. VolkerP

    VolkerP EU Model S P-37

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    I think they are concentrating their resources to get the general production for US market going. Concentrating on target A can be likened to "reducing efforts" on target B, so yes.

    From the 2012Q2 call:

    The EU currently is 27 countries. But it is a market union in the first place, so national regulations were aligned with each other or superimposed with EU regulations. Tesla has to do only one homologation process and afterwards can sell Model S in all countries of the EU.

    The introduction of right hand steering Model S in Europe was planned 6 months after the left hand steering Model S. Check Tesla blog post from GeorgeB.
     
  9. linaser

    linaser Member

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    I think, you're right. Afaik there is no hard evidence, that there are real problems concerning the canadian homolgation.

    Actually the delays for the Canadian Sigs and the European Sigs could have the same cause. And if VolkerP is right this could just be, that Tesla focusing on U.S. general production aka generating cash aka keeping the Sig money longer.

    As a european Sig reservation holder my hopes certainly are, that Tesla will not stall homologation deliberately to keep the cash longer.

    And I certainly hope, that Tesla provides some confidence to the Canadian and European Reservation holders, by communicating transparently why there are delays. It would be even better, if Tesla would give some guidance what's the status of homologation for each market and what that will mean it terms of manufacturing sequence.
     
  10. nikwest

    nikwest Member

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    It would also be a solution to the problem discussed here that Tesla is short on delivery experts and trucks, if they just produce European Sigs early :biggrin:

    You could just add 500 cars to your production list without having to worry about shipping them. I wouldn't mind if Tesla offloads that problem to Europe ;-)
     
  11. NigelM

    NigelM Recovering Member

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    Very unlikely. Cash from reservations is accounted for as a liability on the balance sheet; once that order becomes confirmed the non-refundable part of the deposit can become revenue and once the car is sold the entire receivable becomes revenue. The point is that having revenue is much better than holding liabilities on the balance sheet.

    They are dealing with government bureaucracy....who knows if Tesla even knows the true status?
     
  12. linaser

    linaser Member

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    You're right about the cash from reservation being a liability on the balance sheet, but all other loans like the one from the DOE are too.

    Nevertheless Tesla can use that money to pay bills and wages and if liquidity and not revenue is their biggest concern, then VolkerP could be right anyway.

    Tesla obviously seems to need cash or why would they else have gone through with their recent public offering...

    @NigelM: What do you think: Is it likely, that Tesla needs cash that badly?

    Sure, that may be true, but Tesla could at least tell us, what they know...
     
  13. NigelM

    NigelM Recovering Member

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    No, not in my opinion. The point I was making is that, if they were cash strapped, they'd be better off getting revenue and profits in than in holding reservation liabilities.
     
  14. Brian H

    Brian H Banned

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    That makes no kinda sense. They keep the money anyway. Unless you mean "avoid having to spend any of the EU Sig (deposit) money on what it's meant for", which makes even less sense.
     
  15. neroden

    neroden Happy Model S Owner

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    I would expect Tesla to do as follows.
    (1) For each region of sales, wait for full homologation approval. I don't think Tesla has target dates for that any more, since there is no way Tesla can predict the regulators' schedule.
    (2) The moment the homologation approval comes through, start shifting the factory to producing the Signatures for that region's model. This will take several days minimum.
    (3) What I do not know is how long the "foreign production run" will last; they could stop it with the Signatures or just keep running that region's production until existing orders have been filled before going back to US production.

    Tesla seems to understand now how much the Signature reservation holders want to get their cars EARLY (since they're paying extra for... basically that and nothing else). Yet Tesla cannot predict when full approval will happen. This makes this the only logical course of action.

    Edit: I had not considered the configuration/production lag. It is possible that Tesla will actually wait to ask European reservation holders to *configure* until after full approvals are received, which would change the schedule to a much later one.
     
  16. linaser

    linaser Member

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    I think what VolkerP meant to say is this: Tesla has already gotten an respectable down payment of 40k$ per Signature Model S, which amounts to a total of about 20m$ for all European Sigs. On delivery Tesla would get roughly an additional 50-60k$ in cash upon delivery per car.

    If Tesla manufactures a U.S. P-Model S they've got only 5k$ already and get roughly an additional 75-90k$ per car.

    So if they deliver a U.S. general production car, they get about 15k$-35k more fresh cash per car into the company. Even if this is not being recognized as revenue, this is still cash in their accounts, which they can use to pay bills and wages.

    Does this still sound completely insane to you?
     

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