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Q1 2017 Delivery Estimates

What is your Q1 2017 delivery estimate?

  • Up to 18,000

    Votes: 1 1.1%
  • 18,001 to 20,000

    Votes: 3 3.3%
  • 20,001 to 22,000

    Votes: 16 17.6%
  • 22,001 to 24,000

    Votes: 37 40.7%
  • 24,001 to 26,000

    Votes: 30 33.0%
  • 26,001 to 28,000

    Votes: 3 3.3%
  • 28,001 or more

    Votes: 1 1.1%

  • Total voters
    91
  • Poll closed .
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I doubt the q1 numbers will be that good, maybe 21k delivered.

If they were going to have blow out numbers, they would likely have waited a few extra weeks for the cap raise so it could occur at a higher price.

The cap raise was small enough that waiting longer for a higher price may not have been worth it when factoring in macro risks and the chance for a market sell off, ect.
 
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The one thing everyone misses (and presumably denies) is that order-rate is not as high as it has been. How is it that nobody factors the actual "possibility" of a flattening or drop in custom-order rate into any estimation? It seems that everyone believes there is still some level of "production constraint". Vin issuance rates don't correspond with some of the above estimates. We may end Q1 with only about 20,000 Vin #s issued during the q.

After looking through the delivery spreadsheets, the demo inventory, and the delivery threads, I still think VIN counting is too unreliable to be used for this kind of predictions. The VIN ranges that were delivered or put into demo inventory in Q1 comes across a very wide spread. Worse, the more overseas deliveries is part of the mix, the wider the range gets and the more unreliable. A higher issuance in Q4 could mean a lower issuance in Q1 with the factory shut down in Q1 for 10 days. The numbers are too fuzzy to make any sort of delivery guess.
 
After looking through the delivery spreadsheets, the demo inventory, and the delivery threads, I still think VIN counting is too unreliable to be used for this kind of predictions. The VIN ranges that were delivered or put into demo inventory in Q1 comes across a very wide spread. Worse, the more overseas deliveries is part of the mix, the wider the range gets and the more unreliable. A higher issuance in Q4 could mean a lower issuance in Q1 with the factory shut down in Q1 for 10 days. The numbers are too fuzzy to make any sort of delivery guess.

Last quarter was a perfect example of this, Tesla said they had 2k cars held up at port in china that missed delivery by a few days. You can't pick up on that kind of stuff with vin counting, and that totally changes the outcome for the quarter.
 
After looking through the delivery spreadsheets, the demo inventory, and the delivery threads, I still think VIN counting is too unreliable to be used for this kind of predictions. The VIN ranges that were delivered or put into demo inventory in Q1 comes across a very wide spread. Worse, the more overseas deliveries is part of the mix, the wider the range gets and the more unreliable. A higher issuance in Q4 could mean a lower issuance in Q1 with the factory shut down in Q1 for 10 days. The numbers are too fuzzy to make any sort of delivery guess.

Unless you do them, you don't see the detailed "music" that the data makes. Data science is more about listening and not seeing. Denying certain data is much like climate deniers not reviewing the actual data that the IPCC scientists have been pouring over. I used my data to predict privately 22200 (in my own spreadsheet models) and publicly 22400 deliveries in Q4. Seems pretty accurate after three years of doing it.

You can pick up China in general. You see thousands more produced in a quarter than delivered - it's obvious either they are stuck in port, transit or inventory lots. There was a time when production was "way above" deliveries and after a couple quarters, couldn't even see where they went. It made me think that Q3 2014 production was overstated - and that being that it was not even printed in the quarterly ER and only spoken over the phone by Deepak A (CFO).
 
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Because they moved the delivery for custom order US Model X to May in early February and for Model S to May at the end of February. We know they can build and deliver to anywhere in the US in less than 4 weeks and to California in less than 2 weeks. Why would they push domestic orders into Q2 if they are demand constrained? What is your alternate explanation for custom orders being moved out of Q1 so early ?
@bonaire - This bump is for you. I'm really curious to hear how you rationalize the early movement of custom orders to Q2 with your theory that Tesla is demand limited in Q1.
 
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Unless you do them, you don't see the detailed "music" that the data makes. Data science is more about listening and not seeing. Denying certain data is much like climate deniers not reviewing the actual data that the IPCC scientists have been pouring over. I used my data to predict privately 22200 (in my own spreadsheet models) and publicly 22400 deliveries in Q4. Seems pretty accurate after three years of doing it.

You can pick up China in general. You see thousands more produced in a quarter than delivered - it's obvious either they are stuck in port, transit or inventory lots. There was a time when production was "way above" deliveries and after a couple quarters, couldn't even see where they went. It made me think that Q3 2014 production was overstated - and that being that it was not even printed in the quarterly ER and only spoken over the phone by Deepak A (CFO).

As @Turing noted, VIN counting is not going to let you know that a couple thousand cars didn't make it to deliveries because of a shipping snag. The VINs were allocated. Any accuracy as a result is merely an accident. Further, you don't know how the flow of VINs that were issued in previous quarters will show up in the current quarter, especially with an increasing percentage of deliveries into markets with less timely and robust 3rd party data and much longer shipping times. Not to mention revenue recognition numbers don't exactly match up with registration, especially in jurisdictions where there can be a substantial time difference between customer delivery and registration.
 
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@bonaire - This bump is for you. I'm really curious to hear how you rationalize the early movement of custom orders to Q2 with your theory that Tesla is demand limited in Q1.

Another week of retooling to be scheduled (IMO). And building of inventory now (as usual) to bolster the ABL for a few weeks. Bunch of 100D and 75D now showing up. Should make the custom orders first but they do not help grow the ABL borrowing. Model 3 is critical - in the next two to three months, I have to believe more tooling disruption and refinement will be "knitted in" to the work schedule to finish the release candidates. Model 3 is "everything". It can't be tricky - it must be exacting.

Don't forget that many CA, WA, NV and AZ orders late in Feb and early March are getting end of March delivery. Somewhat typical. Eastern US states presumably are going to use trains for March and early April production. They may "strictly" build Europe/Asia in April. All sorts of reason but they seem to just be repeating the rhythms done in prior months.
 
Explain to me why the hell would Tesla need to bolster ABL with a 1.2B cap raise in the bag???

Build a few hundred or more cars near end of a quarter and deploy as inventory - backed by ABL. They cranked out a lot of P100D and now 100D and X75D recently in large inventory blocks. This allows the factory to run at expected levels and the ABL pays for them @ 85% of their liquidation value until sold. Good for financials and custom orders will wait a little while since they are "captured customers". Business is business. Why wouldn't a company do this? The 1.2B cap raise is being used in the 2.xB capital spend they "say" will be done in H1. So, the cap raise is generally spoken for.
 
@bonaire - This bump is for you. I'm really curious to hear how you rationalize the early movement of custom orders to Q2 with your theory that Tesla is demand limited in Q1.

Another week of retooling to be scheduled (IMO). And building of inventory now (as usual) to bolster the ABL for a few weeks. Bunch of 100D and 75D now showing up. Should make the custom orders first but they do not help grow the ABL borrowing.

Build a few hundred or more cars near end of a quarter and deploy as inventory - backed by ABL. They cranked out a lot of P100D and now 100D and X75D recently in large inventory blocks. This allows the factory to run at expected levels and the ABL pays for them @ 85% of their liquidation value until sold. Good for financials and custom orders will wait a little while since they are "captured customers".

@bonaire, in response to my query as to why Tesla moved delivery for custom orders to Q2 in February, you claimed it was because they were building inventory cars instead in order to bolster the ABL. Let's imagine two different scenarios for the same P100D built in early March:

1) The car goes into inventory, Tesla doesn't record any revenue but receives cash equal to 85% of the value on the ABL line.

2) The car is used to satisfy a custom order placed in late February and is delivered to a US customer in late March. Tesla records the revenue and receives cash equal to 100% of the value from the customer.

Clearly scenario 2 is the more advantageous one for Tesla for both revenue and cash balance. So I don't buy you explanation that "demand limited" Tesla is building inventory cars in early March instead of custom ordered ones that they could have delivered in Q1 if they had the production capacity.

Also, for any cars built in Q1 that are in transit to end customers at the end of the quarter, Tesla has the same access to the ABL that they have for inventory cars. My guess is the inventory cars you are seeing built in March are there because they are needed to satisfy the other portion of demand, which is customers who don't want to wait. Given that most of April's production is slated for international deliveries Tesla has to fill the domestic pipeline with 6 weeks worth of inventory cars.
 
In scenario 1)
- you build a car for inventory and bank 85% for a while.
- the customer waits "a little" but is guaranteed to pay (hardly anyone cancels an order due to locked-in $2500 or higher deposit)
- you can sell that inventory car soon after through lot-sales or through inventory browsers and is "available" for sale even before the customer's car is built. It may take a discount due to test-drive miles or age, but so be it.

If you build customer car first, then inventory, the opportunity costs may end up being larger than the 15%+ delta. This is why auto dealerships stock an ungodly amount of on-site inventory rather than having buyers browse the lot and then put in a custom order. How many Ford or Chevy buyers now, including $50,000 or higher SUVs and trucks, are custom-ordering? 5% maybe? To do inventory right, you actually need to build inventory cars ahead of custom orders. The problem then becomes what happens if the economy doesn't support the inventory base. Inventory on the lots of sales locations is there for satisfying new, interested customers. Yes, there are millionaires who kick-tires on weekends and may write a check for a car on a Saturday afternoon. And with easy financing and lower-rates, even someone with a $70k income can get into a Tesla MS 60 or 75 on a lot with 2-year lease with high residual (Q3 2016). The chickens come home to roost on those in late 2018 when the residuals are under pressure. But in order to sell more cars, you need more cars to sell - hence inventory build.
 
In scenario 1)
- you build a car for inventory and bank 85% for a while.
- the customer waits "a little" but is guaranteed to pay (hardly anyone cancels an order due to locked-in $2500 or higher deposit)
- you can sell that inventory car soon after through lot-sales or through inventory browsers and is "available" for sale even before the customer's car is built. It may take a discount due to test-drive miles or age, but so be it.

If you build customer car first, then inventory, the opportunity costs may end up being larger than the 15%+ delta. This is why auto dealerships stock an ungodly amount of on-site inventory rather than having buyers browse the lot and then put in a custom order. How many Ford or Chevy buyers now, including $50,000 or higher SUVs and trucks, are custom-ordering? 5% maybe? To do inventory right, you actually need to build inventory cars ahead of custom orders. The problem then becomes what happens if the economy doesn't support the inventory base. Inventory on the lots of sales locations is there for satisfying new, interested customers. Yes, there are millionaires who kick-tires on weekends and may write a check for a car on a Saturday afternoon. And with easy financing and lower-rates, even someone with a $70k income can get into a Tesla MS 60 or 75 on a lot with 2-year lease with high residual (Q3 2016). The chickens come home to roost on those in late 2018 when the residuals are under pressure. But in order to sell more cars, you need more cars to sell - hence inventory build.
I am glad we agree that Tesla is building inventory cars to satisfy the additional demand from customers who are used to buying off the lot and are not willing to wait for a custom order to be built.

Here is some analysis on the Model S Order and Delivery Tracker spreadsheet for Q1. My data subset is:
- When ordering, the customer specified Earliest for the Preferred Delivery
- Production Start date is in Q1

These are orders that Tesla can start immediately after the Confirmed date assuming there is available production capacity. For the 110 cars in that data set here are the number of days from Order Confirmed to Production Start:
Min = 2
Max = 74
Avg = 38

This means that on average in Q1 Tesla waited 5 1/2 weeks to start producing a car after they had a confirmed order from the customer. To me that shows a product that is limited by production capacity rather than by demand - a 5 1/2 week backlog. So do we now agree that the demand that Tesla has from the combination of custom orders and inventory sales in equal to or greater than their production capability in Q1?
 
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I have now taken to the view that what is "in transit" is essentially the available inventory available worldwide "that could be sold at any time" - essentially in transit to some new buyer soon, even buyers who have not shown up in stores yet.

This is patently false unless you do not believe what the delivery letter states:
"In addition to Q4 deliveries, about 6,450 vehicles were in transit to customers at the end of the quarter."

And in case there are still doubts for the prognosticators of what this might really mean, they added an extra statement:
"These will be counted as deliveries in Q1 2017."

It's "will be" and no variability as to a dependence on a hope that it might be sold to a new buyer. It's a done deal.

Having said that, my estimates are still actually lower than yours due to the EPA hold up that has now since been lifted.
 
This is patently false unless you do not believe what the delivery letter states:
"In addition to Q4 deliveries, about 6,450 vehicles were in transit to customers at the end of the quarter."

And in case there are still doubts for the prognosticators of what this might really mean, they added an extra statement:
"These will be counted as deliveries in Q1 2017."

It's "will be" and no variability as to a dependence on a hope that it might be sold to a new buyer. It's a done deal.

Having said that, my estimates are still actually lower than yours due to the EPA hold up that has now since been lifted.
Is the EPA hold up particularly bad? From the thread I was reading seems like the cars were already waiting at the delivery centers, not at Fremont.
 
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Your guess is as good as mine. But basing it on the norm that US deliveries is always prioritized in the last month of the quarter, then the backlog would just add to the already usually loaded delivery schedules that typically fills the last 2 weeks of the quarter, which would then result on some going into the "in transit" category.
 
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This is patently false unless you do not believe what the delivery letter states:
"In addition to Q4 deliveries, about 6,450 vehicles were in transit to customers at the end of the quarter."

And in case there are still doubts for the prognosticators of what this might really mean, they added an extra statement:
"These will be counted as deliveries in Q1 2017."

It's "will be" and no variability as to a dependence on a hope that it might be sold to a new buyer. It's a done deal.

Having said that, my estimates are still actually lower than yours due to the EPA hold up that has now since been lifted.

Real consideration here is that the large 6450 number did not appear as an irregular delivery count for Europe, USA (only the insideevs.com estimate) and we have no idea about China/HongKong other than what Jose does with ev-sales.blogspot.com . So, that large number is not yet visible as clearly "will be counted" unless they know they could sell the inventory during Q1 and go by sales cycle "predictability". Overall - the Builds vs. Sold numbers are growing quarter by quarter and will be interesting to see after Q1. In Q4, they didn't even print in the ER how many specific MS or MX were built - only gave a grand-total. That's new to obfuscate those individual numbers. And why would that be done? Now, of course, they could have made 5000 cars the last three weeks in December destined for Europe and Asia and they normally take 3-months to appear.
 
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@bonaire - This bump is for you. I'm really curious to hear how you rationalize the early movement of custom orders to Q2 with your theory that Tesla is demand limited in Q1.

Dennis, have you seen the latest lines in the MS tracking spreadsheet? Confirmations from 3/10 to 3/22 have late April, early May delivery estimates. Moving the date on the ordering page means nothing to the actual delivery estimate of a confirmed order - it may be moved forward in order to entice new orders and appear "demand-heavy" since the date is going "farther away". A guy in NJ just got a confirmation done on 3/22 (1918xx) and has a Late April, early May delivery - east coast and it's a 60D. I think a lot of folks are looking forward to the Model 3. If they can get a car that can accelerate at the same rate as a P100D and cost half the amount, why not wait? Also, a dated MS 60 at $72K or wait a little while longer for $35K and get the latest new thing?
 
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Real consideration here is that the large 6450 number did not appear as an irregular delivery count for Europe, USA (only the insideevs.com estimate) and we have no idea about China/HongKong other than what Jose does with ev-sales.blogspot.com . So, that large number is not yet visible as clearly "will be counted" unless they know they could sell the inventory during Q1 and go by sales cycle "predictability". Overall - the Builds vs. Sold numbers are growing quarter by quarter and will be interesting to see after Q1. In Q4, they didn't even print in the ER how many specific MS or MX were built - only gave a grand-total. That's new to obfuscate those individual numbers. And why would that be done? Now, of course, they could have made 5000 cars the last three weeks in December destined for Europe and Asia and they normally take 3-months to appear.

So you're saying Tesla lied in their delivery letter because you have not seen third party evidence? And there you go again with your "unless they sell the inventory" statement.

If you continue with this reasoning, then it's tantamount to an SEC investigation of Tesla for fraudulent and misleading statements. Consider the gravity of that allegation and be prepared to back it up with facts, not estimates from blogs.
 
Dennis, have you seen the latest lines in the MS tracking spreadsheet? Confirmations from 3/10 to 3/22 have late April, early May delivery estimates. Moving the date on the ordering page means nothing to the actual delivery estimate of a confirmed order - it may be moved forward in order to entice new orders and appear "demand-heavy" since the date is going "farther away". A guy in NJ just got a confirmation done on 3/22 (1918xx) and has a Late April, early May delivery - east coast and it's a 60D. I think a lot of folks are looking forward to the Model 3. If they can get a car that can accelerate at the same rate as a P100D and cost half the amount, why not wait? Also, a dated MS 60 at $72K or wait a little while longer for $35K and get the latest new thing?
That fails to explain the average 5 1/2 week lag from Confirmed to Production Start for those requesting Earliest delivery for all of Q1. If Tesla was demand limited in Q1 they wouldn't push an order confirmed in late February to Q2 delivery. See this post.