new SC incentive could be due to M3 delays

[AnxietyRanger]

Is it possible that the new SC incentives for MS and X is due to quarterly management potentially due to delay in M3 launch. Any new order in May or June most likely will increase sales in Q3 which when tesla supposedly launching the M3?

Anything is possible, but I'm just not seeing this one. Tesla is going to be judged on when the 3 is launched, not on total sales for the quarter (well, they'll be judged on that, too.) It'd take a lot of spin for any amount of S/X sales to be seen as compensating for 3 delays.

I find the concern over Model S/X sales quite likely related to the Model 3 ramp-up in some way. Which way, is still unclear. It is probably a factor of one or more of these things: start of Model 3 deliveries, Model 3 ramp-up speed and initial profit margin on Model 3. Any one of these could seriously harm Tesla's financial standing, if Model S/X were to stall in the meanwhile.

So, while Saghost may be right that it would take a lot of spin for Model S/X sales to be compensating for Model 3 delays, it would take even more spin to cover a financial crisis that were to occur if Model 3 sales were not compensating for a speculated financial downturn on the Model S/X side of business.

 

[AnxietyRanger]

Looks to me like a company-wide push to juice sales and keep good relations with customers.

Nah. Just to juice sales.

 

[JeffK]

to be compensating for Model 3 delays,

Let's not call them delays, because they aren't actually delays...

Otherwise, yes I'd assume Tesla is concerned with sales until Model 3 deliveries start en mass

 

[AnxietyRanger]

Let's not call them delays, because they aren't actually delays...

Otherwise, yes I'd assume Tesla is concerned with sales until Model 3 deliveries start en mass

What I mean by delays is time time between the announced July announcement of Model 3 and the time they can actually ship them in volume. If Tesla had said Model 3 will be announced for sales in December, then I would measure that time starting from December of course... Whatever other timelines Telsa has set for Model 3 are irrelevant, because the market expectation now clearly is a July launch for the product and the Model S/X sales are (if they are) affected accordingly.

If Model 3 is delayed from the expected launch, that would be detrimental not only to stock value, but to converting those pending orders to sales - while the osbourning effect of Model S/X would still likely continue...

However, if Tesla can ship Model 3 without delay starting from a July launch or soon after, then I would say the concern is not delay, but can be either or both of the other two I mentioned: ramp-up speed and profit margin on early models...

 

[JeffK]

If they can increase Q2 orders to make Q3 sales, I think they'll be in good shape. Model X sales shouldn't see a decline as there's no Model Y for a few years.

 

[AnxietyRanger]

If they can increase Q2 orders to make Q3 sales, I think they'll be in good shape. Model X sales shouldn't see a decline as there's no Model Y for a few years.

Yes, indeed there is a good chance the Supercharging demand lever helps liven up sales. We shall see.

As for Model X, a good question. Is it simply about SUV vs. sedan crowd? I'm not so sure. When the choice was between Model S/X, then sure people will go for whichever they fancy more... but a brand new Model 3 with the latest batteries, latest design and half the price... I don't see why it couldn't siphon those buyers away from the Model X, that are mostly in this for the large-battery BEV and less for a premium SUV... some of those have been buying the Model X as well...

I am certainly comparing Model 3 and Jaguar I-Pace as my next potential, most likely BEV purchases, even though they are different form-factors. The lack of large-battery BEVs makes these choices unnatural sometimes. (Not to replace the Model X probably, but to replace another ICE...)

 

[ItsNotAboutTheMoney]

Is it possible that the new SC incentives for MS and X is due to quarterly management potentially due to delay in M3 launch. Any new order in May or June most likely will increase sales in Q3 which when tesla supposedly launching the M3?

Yes, but it could also be to keep US demand up for Q2.

End of quarter is when Tesla pushes US sales, so the delivery times are short and most cars ordered now will be in Q2.

 

[dsvick]

What I mean by delays is time time between the announced July announcement of Model 3 and the time they can actually ship them in volume. If Tesla had said Model 3 will be announced for sales in December, then I would measure that time starting from December of course... Whatever other timelines Telsa has set for Model 3 are irrelevant, because the market expectation now clearly is a July launch for the product and the Model S/X sales are (if they are) affected accordingly.

In that case, you can't start measuring until September which is when they said they'd start volume production. July is supposed to be a delivery event so they will already be producing and delivering small numbers at that point and will ramp up until September when they hope to reach volume production and deliveries.

 

[AnxietyRanger]

In that case, you can't start measuring until September which is when they said they'd start volume production. July is supposed to be a delivery event so they will already be producing and delivering small numbers at that point and will ramp up until September when they hope to reach volume production and deliveries.

Well, I still really think the countdown is from July, though, in the sense that I see the delay. The countdown starts at the point when Model 3 is out, taking attention away from Model S/X, but is not yet shipping enough to compensate.

Again, three points:

1) How long before Model 3 ships
2) How fast Model 3 ships
3) How much does Model 3 generate profits during this time

Any one, or all of them, are questions that can both affect Model S/X sales (osbourning as people wait for Model 3), but also affect the fact how much Model S/X sales are needed to sustain Tesla's fiscal needs (i.e. how fast can Model 3 deliveries compensate for the money needs).

If 1, 2 and/or 3 are bad for Tesla, then Model S/X need to be picking up the slack and the tab in the meanwhile. That was my point.

 

[JeffK]

Well, I still really think the countdown is from July, though, in the sense that I see the delay. The countdown starts at the point when Model 3 is out, taking attention away from Model S/X, but is not yet shipping enough to compensate.

Again, three points:

1) How long before Model 3 ships
2) How fast Model 3 ships
3) How much does Model 3 generate profits during this time

Any one, or all of them, are questions that can both affect Model S/X sales (osbourning as people wait for Model 3), but also affect the fact how much Model S/X sales are needed to sustain Tesla's fiscal needs (i.e. how fast can Model 3 deliveries compensate for the money needs).

If 1, 2 and/or 3 are bad for Tesla, then Model S/X need to be picking up the slack and the tab in the meanwhile. That was my point.

There's another point too:

4) How long until I can make my neighbors and co-workers jealous...

 

[SageBrush]

Is it possible that the new SC incentives for MS and X is due to quarterly management potentially due to delay in M3 launch. Any new order in May or June most likely will increase sales in Q3 which when tesla supposedly launching the M3?

If you are going to engage in paranoia, I'm sure you can be more creative.

 

[JeffK]

If you are going to engage in paranoia, I'm sure you can be more creative.

It's not paranoia as much as poorly worded common sense and the incorrect use of the word "delay"... of course Tesla is trying to promote S/X sales until they start generating cash from Model 3. A dip in Model S sales is expected until the Model 3 reveal as people become more hesitant when making a large purchase, knowing that a cheaper alternative might fit their needs.

 

[AnxietyRanger]

There's another point too:

4) How long until I can make my neighbors and co-workers jealous...

That's seems rather irrelevant to Tesla's bottom line.

 

[JeffK]

That's seems rather irrelevant to Tesla's bottom line.

On the contrary, it's free advertising.