Model X Production ramp up discussion

[bonnie]

With the introduction of 100+ additional superchargers in 2016 this will be a moot point for long range travel.

No, sorry, it will not be a moot point. I'm not sure where you go on trips, but some of us go off the whole freeway experience and will be counting on destination charging. Unless supercharging locations become as common as gas stations (which could very well happen, says that little optimistic voice in the back of my brain), this will always be true.

 

[dirkhh]

No, sorry, it will not be a moot point. I'm not sure where you go on trips, but some of us go off the whole freeway experience and will be counting on destination charging. Unless supercharging locations become as common as gas stations (which could very well happen, says that little optimistic voice in the back of my brain), this will always be true.

A lot of the recent discussion shows the difference between excited optimists and people who see this with a bit more differentiation.
Does Tesla have a lot of reservations right now? Sure. Does that mean they don't need to worry about losing customers? Absolutely not. As the referral program shows, they are quite worried about having a deep enough Model S pipeline and they most definitely are at risk as a company if they don't manage to keep the vast majority of the current reservation holders on board. They are forecasting how many cars sold next year? About 100k. So far this year they've sold about 35k and they have about 40k reservations for the two models (with an IMHO highly unlikely goal of 15k cars in Q4). So They have maybe a quarter of the cars for next year in existing reservations. That's nice, but that means that they need to actually deliver the X to someone at some point, they need to figure out how to scale building is, with the falcon wing doors, with the most complex windshield ever and with the most complex mono post second row seat.
tl;dr: they are stacking the deck against themselves. and every week that goes by without bonnie getting her car and every week that brings new unwelcome surprises (folding 2nd row seats, charger situation, more delivery slips) will make things harder for them.

 

[bonnie]

tl;dr: they are stacking the deck against themselves. and every week that goes by without bonnie getting her car and every week that brings new unwelcome surprises (folding 2nd row seats, charger situation, more delivery slips) will make things harder for them.

In fairness, communication with my delivery specialist has been excellent & I am currently in the 'I'm okay for now' mode. I'm not the kind of person to complain unless I'm prepared to act.

(I once told an ex-bf to quit worrying, I'd never threatened to trash him or worse, though he fully deserved it. He said 'I know! You won't warn me! You'll just do it!! Hahah. He was right. And I didn't. But I digress ...)

I am being treated fairly by Tesla. But you're right, there are some surprises that I wasn't expecting. I'm okay for now.

 

[RobStark]

About 100k. So far this year they've sold about 35k and they have about 40k reservations for the two models (with an IMHO highly unlikely goal of 15k cars in Q4).

with the most complex windshield ever

They have guided for 1600-1800 vehicles per week in 2016 with Q1 near 1600 and Q4 just above 1800.

That is 80k-90k units. Adding another 10k units would be "significant" not a rounding error.


Tesla does not make windshields.


BTW Tesla needs to deliver 16,843 in Q4 2015 to meet minimum annual guidance. They sounded pretty confident in the most recent call and we are already in November. If they did not know it was within grasp they would have backtracked.

 

[Zaxxon]

In fairness, communication with my delivery specialist has been excellent & I am currently in the 'I'm okay for now' mode. I'm not the kind of person to complain unless I'm prepared to act.

...

I am being treated fairly by Tesla.

This is neither here nor there, and I mean no disrespect to Bonnie (as Sig #2 she absolutely should have a better line on status of her car than us lowly Prod reservation holders). But while it's great that Bonnie's being treated fairly, the group of reservation holders as a whole surely are not.

Either the car has launched or it hasn't. By any reasonable (even charitable) definition, the car has not launched: pricing, specs, believable official delivery dates for those with reservations--none of these things exists for any customers 5.5 weeks after launch.

Given that Tesla held a launch event in September and zero public customer cars even have delivery dates yet, IMO there should have been significant coordinated communication to the reservation holder group by now. Not necessarily an apology, but a clear 'here's where we're at, here's what's holding us up, here's a date at which we'll follow up with another update'. Something more than the single largely detail-free post-launch email we received. (Though I'd love to believe that email's suggestion that all reservation holders would be invited to configure this year, hope is waning.) It's rather embarrassing that Tesla continues with their secrecy in November. It does suggest that reservation holders are being taken for granted, or at least not being thought of as actual people trying to patiently wait for actual vehicles that they actually need to carry actual families in actual timeframes.

I'm not going anywhere, and neither is my reservation. But the amateur communication does strain Tesla's credibility and certainly is getting rather old. I am not surprised by it as I've been around long enough to know that this is largely how the S launch went, but I had hoped things would be improved this time around. With the 3 reveal slated to happen in < 5 months, the X situation doesn't inspire hope that Tesla is prepared to start managing *that* group relatively imminently!

Following the situation closely and reading between the lines as many of us here do, it's clear (IMO) that the root cause is that the car and its attendant engineering decisions and supplier lineup are not complete, 5.5 weeks after 'launch'. This makes the day-before-Q3-end launch date quite suspicious. Let's just say they didn't pick that date for the good of their customers.

 

[simplejack]

That would be true if they were demand constrained. As it is, your $100K will be replaced with somebody else's $100K. That won't make any difference to Tesla. And at some point when their cars are more available, likely you'll buy one (for the same reasons you want to buy one now). In fact it's actually better for Tesla that things go this way because they want current buyers to be patient and understanding, not those scared off by every bump in the road.

Because the $100k market has an infinite number of customers? Sorry, passing on customers isn't a good business practice and Tesla can't survive unless they sell substantially more cars in the coming years. At some point even the most ardent supporter has to admit Tesla is botching this rollout. Their cash burn is spectacular and they need all the revenue they can get.

- - - Updated - - -

On another note, remind me again how much stock Elon got for delivering the X in Q3?

 

[Lump]

On another note, remind me again how much stock Elon got for delivering the X in Q3?

2012 CEO Grant
In August 2012, our Board of Directors granted 5,274,901 stock options to our CEO (2012 CEO Grant). The 2012 CEO Grant consists of ten vesting tranches with a vesting schedule based entirely on the attainment of both performance conditions and market conditions, assuming continued employment and service to us through each vesting date.
Each of the ten vesting tranches requires a combination of one of the ten pre-determined performance milestones and an incremental increase in our market capitalization of $4.0 billion, as compared to the initial market capitalization of $3.2 billion measured at the time of the 2012 CEO Grant.
As of September 30, 2015, the market conditions for seven vesting tranches and the following performance milestones were achieved and approved by our Board of Directors:

·

Successful completion of the Model X Alpha Prototype; and

·

Successful completion of the Model X Beta Prototype

As of September 30, 2015, the following three performance milestones were considered probable of achievement:

·

Successful completion of the Model 3 Alpha Prototype

·

Aggregate vehicle production of 100,000 vehicles; and

·

Successful completion of the Model 3 Beta Prototype

The following performance milestone was achieved in the third quarter and ratified by the Compensation Committee on October 6, 2015.

·

Completion of the first Model X Production Vehicle

Elon delivering the first "production"? MX to himself was meeting a milestone in Q3.

 

[walla2]

Either the car has launched or it hasn't. By any reasonable (even charitable) definition, the car has not launched: pricing, specs, believable official delivery dates for those with reservations--none of these things exists for any customers 5.5 weeks after launch. .

In 2012, the model S launched similarly. July 2012 was supposed to be the launch with a rapid ramp. Rapid meant, start building cars several months later. I was somewhat surprised to see them have similar problems as in 2012 but then again I wasn't since I've been guessing only 100 X's will be made this year.

 

[anticitizen13.7]

Elon delivering the first "production"? MX to himself was meeting a milestone in Q3.

As a shareholder, I should find it outrageous that Elon delivering the first "production" Model X to himself counts as meeting a milestone (and it is outrageous), but for some reason I find it hilariously funny, even if it is a :cursing: move.

 

[shokunin]

Because the $100k market has an infinite number of customers? Sorry, passing on customers isn't a good business practice and Tesla can't survive unless they sell substantially more cars in the coming years. At some point even the most ardent supporter has to admit Tesla is botching this rollout. Their cash burn is spectacular and they need all the revenue they can get.

And this is also why Tesla needs to accelerate validation/pricing/announcement of the smaller pack X. The guesstimate of $96K base price on X90D is going to see, IMHO, a large number of deferrals or cancellations. None of my friends who have X reservations would buy if the base cost is at $96K. They want a nicely optioned at or under $100K, that's before tax and title.

 

[simplejack]

Elon delivering the first "production"? MX to himself was meeting a milestone in Q3.

So about $100M. I guess someone considers the launch very successful.

 

[ptsagcy]

No, sorry, it will not be a moot point. I'm not sure where you go on trips, but some of us go off the whole freeway experience and will be counting on destination charging. Unless supercharging locations become as common as gas stations (which could very well happen, says that little optimistic voice in the back of my brain), this will always be true.

+1 Bonnie - The charger issue is all about destination charging. If the "destination" has one HPWC, how happy are folks going to be when they have to wait 8+ hours to use the charger while someone else is charging at 40A? That will mean that you can't do an overnight charge. It also doubles the amount of time, or halves the amount of charge, at a given charger.

 

[Cosmacelf]

As a shareholder, I should find it outrageous that Elon delivering the first "production" Model X to himself counts as meeting a milestone (and it is outrageous), but for some reason I find it hilariously funny, even if it is a :cursing: move.

Does it really matter? Those tranches didn't have expiration dates, so whether Elon got 500,000 shares this quarter or next quarter doesn't matter a whole heck of a lot.

 

[Oyvind.H]

So still no news on deliveries in the US?

Back in august I sold my Model S because I thought I saw a snowball effect. People invited to configure, two week (or so?) timeframes given to complete configuration, launch event in end september.

And now we`re soon half way through november, and nothing has changed. I`ve begun to fear driving next summer vacation in europe in a rental. Not quite what I had in mind back in august.

 

[Matias]

So about $100M. I guess someone considers the launch very successful.

I guess the Six founders cars are the most expensive cars in history? They cost 17 M USD a piece to stock holders

 

[PGeer]

This is neither here nor there, and I mean no disrespect to Bonnie (as Sig #2 she absolutely should have a better line on status of her car than us lowly Prod reservation holders). But while it's great that Bonnie's being treated fairly, the group of reservation holders as a whole surely are not.

Either the car has launched or it hasn't. By any reasonable (even charitable) definition, the car has not launched: pricing, specs, believable official delivery dates for those with reservations--none of these things exists for any customers 5.5 weeks after launch.

Given that Tesla held a launch event in September and zero public customer cars even have delivery dates yet, IMO there should have been significant coordinated communication to the reservation holder group by now. Not necessarily an apology, but a clear 'here's where we're at, here's what's holding us up, here's a date at which we'll follow up with another update'. Something more than the single largely detail-free post-launch email we received. (Though I'd love to believe that email's suggestion that all reservation holders would be invited to configure this year, hope is waning.) It's rather embarrassing that Tesla continues with their secrecy in November. It does suggest that reservation holders are being taken for granted, or at least not being thought of as actual people trying to patiently wait for actual vehicles that they actually need to carry actual families in actual timeframes.

I'm not going anywhere, and neither is my reservation. But the amateur communication does strain Tesla's credibility and certainly is getting rather old. I am not surprised by it as I've been around long enough to know that this is largely how the S launch went, but I had hoped things would be improved this time around. With the 3 reveal slated to happen in < 5 months, the X situation doesn't inspire hope that Tesla is prepared to start managing *that* group relatively imminently!

Following the situation closely and reading between the lines as many of us here do, it's clear (IMO) that the root cause is that the car and its attendant engineering decisions and supplier lineup are not complete, 5.5 weeks after 'launch'. This makes the day-before-Q3-end launch date quite suspicious. Let's just say they didn't pick that date for the good of their customers.

As a fairly early Sig, I've been quiet on this topic, figuring I'm still going to get a great car and sooner than a lot of other folks who have waited a similar amount of time. Other than lack of 72amp charger (we're going to use X as our road trip car), I know I'll be delighted with the car. And I can forgive Tesla for needing to take longer than they would like to get it right.

But I STRONGLY agree with Zaxxon that the Tesla culture of secrecy has gone a bit too far. One doesn't have to reveal secrets in an email to reservation holders. A simple "We know you're anxiously waiting and we're working as hard as we can to build your car over the next X months" would be so welcome. It would feel like a bit of personal attention. Some would argue that something this ambiguous wouldn't help, but I believe psychologically it would be a game changer. It would be an acknowledgement, which goes a long way in human interactions.

It's a little odd, when you think about it. Tesla is doing so incredibly well in customer service once you have your car. The company needs to recognize that that culture needs to extend to those of us who are customers in waiting.

 

[ohmman]

It's a little odd, when you think about it. Tesla is doing so incredibly well in customer service once you have your car. The company needs to recognize that that culture needs to extend to those of us who are customers in waiting.

And arguably, potential customers.

Totally agree with your sentiments.

 

[Alec]

And arguably, potential customers.

Totally agree with your sentiments.

Me too, this really sums it up. I've been so excited about this for so long (reserved January 2013), and the whole thing is starting to curdle on me a little bit. Not because of the delays - I have a lot of respect for the complexity of what's being accomplished here - but because of the repeated and inexplicable failure of Tesla to communicate with me about the delays. Surely they have a comms department - what are they doing? Send us an email, tell us what's up. It's free, it's instant, and it's just basic courtesy with your loyal customers.

 

[Merrill]

Totally agree with everyone, love the company but if I were to have done this kind of communication with my company we would have gone out of business.

 

[AlMc]

Me too, this really sums it up. I've been so excited about this for so long (reserved January 2013), and the whole thing is starting to curdle on me a little bit. Not because of the delays - I have a lot of respect for the complexity of what's being accomplished here - but because of the repeated and inexplicable failure of Tesla to communicate with me about the delays. Surely they have a comms department - what are they doing? Send us an email, tell us what's up. It's free, it's instant, and it's just basic courtesy with your loyal customers.

Totally agree with everyone, love the company but if I were to have done this kind of communication with my company we would have gone out of business.

Agreed. These are the times I REALLY miss George B and Jerome.:crying: