Model 3 reveal effect on other luxury car sales

[landis]

They could then be selling double that amount in the next 6 months with half tax credit. And then double rate again with 1/4 tax credit. All in all hundreds of thousands of Model 3s could be sold with federal tax credit.

Therefore, based on your estimate of 10K per month for Model 3 production:
Approximately half ...

Also including the (not unreasonable) doubling part of the 'estimate' yields 60k+120k+240k=420k, or all of the known reservation holders.

 

[Chuq]

Also including the (not unreasonable) doubling part of the 'estimate' yields 60k+120k+240k=420k, or all of the known reservation holders.

Also don't forget that the number only counts cars sold in the US, not made in the US, so deduct the Europe/Asia/Australia reservation holders from that.

(I expect that when Tesla start to get close to 200,000 in a quarter, they'll put the US ones on hold until the next quarter, at which point they will go flat out fulfilling as many US orders as they can.

 

[dsvick]

Now that the thread has been completely hijacked ....

My, quick math gives me...
86804 US sales to date
25000 Additional US sales for 2nd half of 2016 (using the TMs estimate of 50,000 produced, guessing that half stay in the US)
78000 US, MS and MX sales for 2017 (figuring production at 3000 per week half of which stay in the US)

That's right at 190,000 with no M3 sales figured. I'm thinking M3 deliveries start late Q3 or early Q4 of 2017, and if they hit even the low end of their estimate and produce 100,000 in 2017, they should hit the 200,000 in Q4.

Keeping in mind that these guesses are no better, and probably worse than, using a magic 8 ball.

 

[lklundin]

I expect that when Tesla start to get close to 200,000 in a quarter, they'll put the US ones on hold until the next quarter, at which point they will go flat out fulfilling as many US orders as they can.

I am guessing that they are optimizing their US sales on a slightly longer time scale.

By that I mean that if Tesla deliberately export the majority of their production for one or even better two years, then by the time they start a quarter with US sale number 200k, their annual production could be at its planned maximum of 500k.

At an annual production of 500k vehicles, the maximum achievable tax rebate would be:
200k * 7500$ = 1500 M$ (full tax rebate for US sales up to 200k vehicles)
250k * 7500$ = 1875 M$ (full tax rebate for US sales in two subsequent quarters)
250k * 3750$ = 937.5 M$ (half tax rebate for US sales in two subsequent quarters)
250k * 1875$ = 468.75M$ (quarter tax rebate for US sales in two subsequent quarters)

That works out to 4.8 G$ in tax rebates (but assumes very limited domestic sales until maximum production is achieved followed by no exports for 18 months...)

 

[flamingoezz]

Elon has stated that the ramp for M3 with be an S-curve. He didn't know when the ramp would begin, but I think it's fair to say that the number of cars built or delivered wouldn't look the same for over a year. It might looks something more like this -- just my guess.

Q3 2017 Full amount
20K S+X, 20K M3
Employee Pre-orders

Q4 2017 Full amount
22K S+X, 35K M3
West Coast S&X owners

Q1 2018 Full amount
24K S+X, 40K M3
200K cars in US, rebate starts phasing out
East Coast S&X owners start arriving

Q2 2018 Full amount
24K S+X, 75K M3
Day 1 non-S&X owners
15% shipped internationally -- probably Canada/Mexico
Approx 160K M3's get full credit -- all of day one US preorders

Q3 2018 50% of full amount
26K S+X, 90K M3
60% shipped internationally
Europe/Asia start seeing cars

Q4 2018 50% of full amount
26K S+X, 95K M3
60% shipped internationally
400K cars in 2018 -- short of Elon's 500K estimate
75K M3's get 50% credit -- accounting for all pre-reveal 2 reservations
All international pre-orders get their car by end of 2019

Q1 2019 25% of full amount
14K S+X, 100K M3
65% shipped internationally

Q2 2019 25% of full amount
14K S+X, 105K M3
65% shipped internationally


I'm basing this on:
Elon's statements about placing a preorder now to get a car in 2018 (during Q2 conference call)
Elon's statements about 500K car production in 2018
Elon's statements about 100-200K car production in 2018
Elon's statements about the ramp up for M3 being an S-curve
Elon's statements about sacrificing numbers in a quarter to maximize customer happiness (in relation to tax credits)
Tesla's history of not hitting deadlines
Elon's statements about delivery priority in USA
Tesla X history of beginning international distribution 3Q after release in USA
Tesla X history of starting international deliveries in Canada

Great example. Therefore, based on your estimate of 10K per month for Model 3 production:

30K - Q1 2018 Full amount
30K - Q2 2018 Full amount
30K - Q3 2018 50% of full amount
30K - Q4 2018 50% of full amount
30K - Q1 2019 25% of full amount
30K - Q2 2019 25% of full amount
180K - Total 60K full credit, 120K partial credits. So approximately half of the current reservations.

 

[SageBrush]

Gaming the tax credit rules is no doubt attractive to Tesla because it is important to customers, but it is obviously not the only consideration:

• Current Tesla owners were promised early access
• A close_to_home beta is almost certainly advisable to iron out first run bugs

 

[Topher]

Gaming the tax credit rules is no doubt attractive to Tesla because it is important to customers, but it is obviously not the only consideration:

• Current Tesla owners were promised early access
• A close_to_home beta is almost certainly advisable to iron out first run bugs

Neither of those would seem to much affect the tax credit situation.

Thank you kindly.

 

[SageBrush]

Neither of those would seem to much affect the tax credit situation.

Agreed; I wrote that post too long ago to remember the intent.

 

[22522]

Yes

 

[Red Sage]

Here is a list of recent unit sales for vehicles I believe will be direct competitors to Tesla Model ☰:

2015 US SALES
47,080_-_ Acura TLX
00,000_-_ Alfa Romeo Giulia
29,013_-_ AUDI A4
94,427_-_ BMW 3-Series
46,082_-_ BMW 4-Series
26,873_-_ Cadillac ATS
43,874_-_ Infiniti Q50
00,000_-_ Jaguar XE
46,430_-_ Lexus IS
86,080_-_ Mercedes-Benz C-Class​

So, a market of 419,859 cars during 2015. Where BMW 3-Series and 4-Series combined for 140,509 units sold in 2015, they are a bit behind that pace this year. The 4-Series sold 46,082 cars in the last seven months of 2015, but sold only 21,462 units during the first seven months of 2016. With only 39,775 units sold through July 2016, the 3-Series is on a pace to have a US total well below 90,000 units for the first time in the past 14 years.

Usually, December is among their best months for sales, allowing for a strong finish, but in 2015 they were unusually low at under 5,300 units. For comparison they sold 19,464 units in December 2014 and in a low year, they sold 8,489 units in December 2011.

Meanwhile, the Mercedes-Benz C-Class has sold 43,609 units so far this year, 12.3% off the 49,721 pace through the first seven months of 2015, though enough to claim the lead in class so far this year.

If Tesla Motors is able to build 300,000 of the Model ☰ during 2018... And 60% of those reach US Customers... That would be 180,000 units. Nearly 40,000 units more than BMW 3-Series and 4-Series have managed combined in any given year. And if it ends up being 'only' 40% of that total... That is still 120,000 units in the hands of US Customers. Far more than any other vehicle in class. I'm contemplating removing the 'If' and starting with 'When' instead...

 

[SageBrush]

Here is a list of recent unit sales for vehicles I believe will be direct competitors to Tesla Model ☰:

2015 US SALES
47,080_-_ Acura TLX
00,000_-_ Alfa Romeo Giulia
29,013_-_ AUDI A4
94,427_-_ BMW 3-Series
46,082_-_ BMW 4-Series
26,873_-_ Cadillac ATS
43,874_-_ Infiniti Q50
00,000_-_ Jaguar XE
46,430_-_ Lexus IS
86,080_-_ Mercedes-Benz C-Class​

So, a market of 419,859 cars during 2015. Where BMW 3-Series and 4-Series combined for 140,509 units sold in 2015, they are a bit behind that pace this year. The 4-Series sold 46,082 cars in the last seven months of 2015, but sold only 21,462 units during the first seven months of 2016. With only 39,775 units sold through July 2016, the 3-Series is on a pace to have a US total well below 90,000 units for the first time in the past 14 years.

Usually, December is among their best months for sales, allowing for a strong finish, but in 2015 they were unusually low at under 5,300 units. For comparison they sold 19,464 units in December 2014 and in a low year, they sold 8,489 units in December 2011.

Meanwhile, the Mercedes-Benz C-Class has sold 43,609 units so far this year, 12.3% off the 49,721 pace through the first seven months of 2015, though enough to claim the lead in class so far this year.

If Tesla Motors is able to build 300,000 of the Model ☰ during 2018... And 60% of those reach US Customers... That would be 180,000 units. Nearly 40,000 units more than BMW 3-Series and 4-Series have managed combined in any given year. And if it ends up being 'only' 40% of that total... That is still 120,000 units in the hands of US Customers. Far more than any other vehicle in class. I'm contemplating removing the 'If' and starting with 'When' instead...

Not meant to detract from your post*, I suspect that the list of pirated sales will be deep and varied. It is certainly true for me as a hybrid to EV convertee and more generally a consumer who has never had reason until now to spend M3 level of money on a car before.

*It's hard to imagine that the luxury marquees will not be dragged down by Tesla

 

[Neohippy]

Not meant to detract from your post*, I suspect that the list of pirated sales will be deep and varied. It is certainly true for me as a hybrid to EV convertee and more generally a consumer who has never had reason until now to spend M3 level of money on a car before.

*It's hard to imagine that the luxury marquees will not be dragged down by Tesla

The new M3 is going to be the most money I have spent on a car myself. I'm planning on getting a heavily optioned one. I'm a car fanatic and a speed junky. This car will satisfy all of my needs. I'm thinking of selling my supercharged Nsx since I rarely drive it and after driving a P90D it felt slow. The performance you get with Tesla is amazing.

 

[Red Sage]

*It's hard to imagine that the luxury marquees will not be dragged down by Tesla

Correct. I think that Mercedes-Benz would be happy to simply hold serve, and maintain a second place status with the C-Class. Just behind the Tesla Model ☰ instead of the 3-Series perennial leader. The C-Class is actually leading among this class of cars so far during 2016.

2016 US Sales YTD
22,037 _-_ Acura TLX
00,000 _-_ Alfa Romeo Giulia
18,499 _-_ AUDI A4
39,775 _-_ BMW 3-Series
21,462 _-_ BMW 4-Series
11,883 _-_ Cadillac ATS
23,059 _-_ Infiniti Q50
_1,872 _-_ Jaguar XE
20,560 _-_ Lexus IS
43,609 _-_ Mercedes-Benz C-Class​

 

[SageBrush]

Correct

I'm relieved that you agree with me, but that does not make me correct.

 

[Red Sage]

I'm relieved that you agree with me, but that does not make me correct.

Well, they could be 'dragged down' by their own pride, prejudice, and sense of perspective instead.

 

[ggies07]

Here is a list of recent unit sales for vehicles I believe will be direct competitors to Tesla Model ☰:

2015 US SALES
47,080_-_ Acura TLX
00,000_-_ Alfa Romeo Giulia
29,013_-_ AUDI A4
94,427_-_ BMW 3-Series
46,082_-_ BMW 4-Series
26,873_-_ Cadillac ATS
43,874_-_ Infiniti Q50
00,000_-_ Jaguar XE
46,430_-_ Lexus IS
86,080_-_ Mercedes-Benz C-Class​

So, a market of 419,859 cars during 2015. Where BMW 3-Series and 4-Series combined for 140,509 units sold in 2015, they are a bit behind that pace this year. The 4-Series sold 46,082 cars in the last seven months of 2015, but sold only 21,462 units during the first seven months of 2016. With only 39,775 units sold through July 2016, the 3-Series is on a pace to have a US total well below 90,000 units for the first time in the past 14 years.

Usually, December is among their best months for sales, allowing for a strong finish, but in 2015 they were unusually low at under 5,300 units. For comparison they sold 19,464 units in December 2014 and in a low year, they sold 8,489 units in December 2011.

Meanwhile, the Mercedes-Benz C-Class has sold 43,609 units so far this year, 12.3% off the 49,721 pace through the first seven months of 2015, though enough to claim the lead in class so far this year.

If Tesla Motors is able to build 300,000 of the Model ☰ during 2018... And 60% of those reach US Customers... That would be 180,000 units. Nearly 40,000 units more than BMW 3-Series and 4-Series have managed combined in any given year. And if it ends up being 'only' 40% of that total... That is still 120,000 units in the hands of US Customers. Far more than any other vehicle in class. I'm contemplating removing the 'If' and starting with 'When' instead...

damn I like your math son!

 

[physicsfita]

Not meant to detract from your post*, I suspect that the list of pirated sales will be deep and varied. It is certainly true for me as a hybrid to EV convertee and more generally a consumer who has never had reason until now to spend M3 level of money on a car before.

*It's hard to imagine that the luxury marquees will not be dragged down by Tesla

I tend to agree -- when I was standing in line on 3/31, I only noticed a couple 3-series class or better cars in the lot. There were a decent number of hybrids and fuel-efficient cars as well as bunch of more-traditional "gets you from A to B" vehicles.

 

[Red Sage]

damn I like your math son!

Thanks. Tesla Motors doesn't actually have to manufacture 500,000 vehicles in 2018. Though it would be nice. If Model S and Model X combined comes to 100,000 units and Model ☰ is 'only' 200,000 units, they will probably make a very nice showing in the US. I figure that would mean about 50,000 of Generation II cars, with a minimum of 120,000 Model ☰ showing as Delivered here. If Tesla Motors were to sell 170,000 vehicles domestically just two years from now, that would put them right in line with traditional automobile manufacturers such as these:

2012 -- Acura and Buick both sold over 150,000 but less than 200,000 units as a brand. 120,000 units or more for any particular vehicle make and model would have reached #35 overall, and #18 for a passenger car, that year.

2013 -- Acura, Audi, and Cadillac each sold over 150,000 but less than 200,000 units as a brand. 120,000 units or more for any particular vehicle make and model would have reached #39 overall, and #18 for a passenger car, that year.

2014 -- Acura, Audi, and Cadillac each sold over 150,000 but less than 200,000 units as a brand. 120,000 units or more for any particular vehicle make and model would have reached #41 overall, and #21 for a passenger car, that year.

2015 -- Acura, and Cadillac both sold over 150,000 but less than 200,000 units as a brand. 120,000 units or more for any particular vehicle make and model would have reached #40 overall, and #20 for a passenger car, that year.​

Because of this, I feel confident in predicting that the Tesla Model ☰ will at the very least: 1) Get into the Top
50 vehicles sold; and 2) Reach at least the Top 25 passenger cars sold in the US during 2018. That is, to me, a rather conservative estimate. I strongly believe that Tesla Motors will want to do even better, by having more than 50% of Model ☰ Deliveries during 2018 go to US Customers for most of the year. If the Model ☰ manages to
somehow surpass 200,000 units in the US during one calendar year, that will stand as firm notice to the traditional automobile manufacturers that this is no fad. People want compelling, long range, fully electric cars and are willing to pay for them.

I know that most people seem to think of 'mass market' as being a particular price point. I believe it is instead based upon the number of units sold. There are numerous 'cheap' cars that are regularly outsold by vehicles that cost twice as much. A low price does not guarantee wide sales, because some very 'affordable' cars nevertheless find no takers. When it comes to new cars, people do their best to buy what they want. Because they deserve to.

 

[SageBrush]

I know that most people seem to think of 'mass market' as being a particular price point. I believe it is instead based upon the number of units sold. There are numerous 'cheap' cars that are regularly outsold by vehicles that cost twice as much. A low price does not guarantee wide sales, because some very 'affordable' cars nevertheless find no takers. When it comes to new cars, people do their best to buy what they want. Because they deserve to.

It is interesting to think a bit about 'mass market.'

• One the one hand it might imply profit: if car 'A' is profitable, the lots of 'A' sold is that much more profit
• Unrelated to profit, car 'A' sold means car 'B' from the competitor(s) is not.

Tesla appears to be a real threat on both fronts to the competitors.

 

[FlatSix911]

Interesting reading ... New EV study praises Tesla, BMW & Nissan for nationwide availability, shames Honda & Toyota