Reserving your Model 3 (official Tesla blog)

[Langmuir]

First post I guess out of many to come...

I reserved online a week ago, location Belgium. Hoping for a late 2019 delivery (my current car is under 18 months old).

One thing I do not understand - I didn't receive any reservation number (as many here mention). Only the attached mail...

FRANCE, non-owner, reserved 3/31 at tesla store opening (8:30am french time). i am RN 1075xxxxx

Ps: Fun to realise that i am on the google map pics of bordeaux tesla store taken the 3/31

 

[houdini]

By buying an up-optioned car you support Tesla's mission and get your car sooner, win-win. If you plan on getting a base model you'll probably have to wait but you do get the joy of knowing you helped support Tesla in the meantime by giving them your $1000 and letting them use it to make the infrastructure necessary to make all this happen.

They can't really "use" your $1000 as all deposits are refundable so I think legally they have to hold those deposits in case everyone cancelled. They can of course raise money on the huge predicted demand.

 

[melindav]

First post I guess out of many to come...

I reserved online a week ago, location Belgium. Hoping for a late 2019 delivery (my current car is under 18 months old).

One thing I do not understand - I didn't receive any reservation number (as many here mention). Only the attached mail...

when you login to the "mytesla" page on tesla's site with the same email address you reserved with, you will see it.

 

[Autolycus]

They can't really "use" your $1000 as all deposits are refundable so I think legally they have to hold those deposits in case everyone cancelled. They can of course raise money on the huge predicted demand.

They didn't make any sort of agreement to hold the money in trust. They can most definitely spend it. We paid $1,000 for the right to buy a car. That $1,000 is theirs until we exercise our right to a refund or until we order a car, at which time the $1,000 is given back to us as a credit against the cost of the car. If Tesla goes bankrupt, we'll be pretty low down the list of creditors in getting our money.

 

[PJFW8]

First post I guess out of many to come...

I reserved online a week ago, location Belgium. Hoping for a late 2019 delivery (my current car is under 18 months old).

One thing I do not understand - I didn't receive any reservation number (as many here mention). Only the attached mail...

 

[PJFW8]

It can take a few business days. Welcome!

 

[Langmuir]

Actually, I found it on MyTesla, which was strange considering that I didn't previously register on it.

It is a random number I guess that doesn't explain my "local list place", anyways starting with 1075xxxxx...

Thanks for the welcomes!

 

[AZ Desert Driver]

First post I guess out of many to come...

I reserved online a week ago, location Belgium. Hoping for a late 2019 delivery (my current car is under 18 months old).

One thing I do not understand - I didn't receive any reservation number (as many here mention). Only the attached mail...

I ordered mine 3/31 and got RN1078. Shows RN sequence is not ...well usable to the common folks.

 

[bobw]

Actually, I found it on MyTesla, which was strange considering that I didn't previously register on it.

It is a random number I guess that doesn't explain my "local list place", anyways starting with 1075xxxxx...

Thanks for the welcomes!

You register on MyTesla as part of the process of preordering the car.

 

[houdini]

They didn't make any sort of agreement to hold the money in trust. They can most definitely spend it. We paid $1,000 for the right to buy a car. That $1,000 is theirs until we exercise our right to a refund or until we order a car, at which time the $1,000 is given back to us as a credit against the cost of the car. If Tesla goes bankrupt, we'll be pretty low down the list of creditors in getting our money.

I think a Company auditor would take a very dim view of a Company spending money that was availabe for refund at any second that a customer chooses to ask for it back.

This article makes reference to something I had read elsewhere - Tesla Cancels Excess Model 3 Reservations

Quote: "even though Tesla says the reservation fees will be separated and not treated as income, the volume of reservations deposits still add up to a tidy sum and can have an implicit positive effect on Tesla’s share price."

They can happily borrow or raise against forecast sales using the reservation numbers as an indication of sales rather than just taking a guess, but they can't spend the deposit money.

 

[AZ Desert Driver]

As to Deposit...Warren Buffet says Insurance premiums are monies not owned by him and just not yet paid out - but he gets to use the float. One could use the Deposit as "float". One could also do an actuarial like calculation and hold some aside for immediate payout and invest the rest. I doubt they are stuffing dollar bills under a mattress waiting for refunds. There are some very smart ways to hold this sum (and some dumb ways)

 

[Autolycus]

As to Deposit...Warren Buffet says Insurance premiums are monies not owned by him and just not yet paid out - but he gets to use the float. One could use the Deposit as "float". One could also do an actuarial like calculation and hold some aside for immediate payout and invest the rest. I doubt they are stuffing dollar bills under a mattress waiting for refunds. There are some very smart ways to hold this sum (and some dumb ways)

Insurance is a totally different thing. It is highly regulated by every state. All states require significant reserves held in trust to assure that the company has sufficient funds for all anticipated claims.

 

[melindav]

the reservation agreement specifically stated the deposit funds would NOT be held in escrow or trust.

 

[Snow Drift]

From an accounting standpoint it is considered Prepaid (a liability) and cannot be considered as income received.
....

"Under the accrual method of accounting, income that is received in advance is a liability because the company that received the money has not yet earned it and it has an obligation (a liability) to deliver the related goods or services in the future. Accountants may say that the income should be deferred to a balance sheet account until it is earned. Once the money is earned it will be moved from the balance sheet account to a revenue or income account.

In terms of debits and credits, the company receiving the money in advance will debit the asset account Cash and will credit a liability account such as Unearned Income, Unearned Revenues, Deferred Income, Deferred Revenues, Customer Deposits, etc. Let's assume that the credit is made to Deferred Income.

After the company earns the money that was prepaid (by delivering the goods or services), it will then debit Deferred Income and will credit a revenue or income account."

 

[sunrocket]

I think it's faster for them to meet demands in California first than Maine ._.

I think Tesla figures shipping from Fremont, Ca. plant (or the Livermore, Ca. warehouse they rented recently) will be easier and cheaper (I'll drive to the damn plant if I can get it june 2018 lol)

 

[AZ Desert Driver]

From an accounting standpoint it is considered Prepaid (a liability) and cannot be considered as income received.
....

"Under the accrual method of accounting, income that is received in advance is a liability because the company that received the money has not yet earned it and it has an obligation (a liability) to deliver the related goods or services in the future. Accountants may say that the income should be deferred to a balance sheet account until it is earned. Once the money is earned it will be moved from the balance sheet account to a revenue or income account.

In terms of debits and credits, the company receiving the money in advance will debit the asset account Cash and will credit a liability account such as Unearned Income, Unearned Revenues, Deferred Income, Deferred Revenues, Customer Deposits, etc. Let's assume that the credit is made to Deferred Income.

After the company earns the money that was prepaid (by delivering the goods or services), it will then debit Deferred Income and will credit a revenue or income account."

yeah---accounted for on this sheet or that - but not stashed in a mattress. Can they put it into a savings account and make 2%? Can they buy hardware that is dedicated to the goods to be delivered?
Now - I'm not a corporate finance genius or any sort of accountant, but it just seems that holding a million dollar pile of cash and not putting it into some safe place seems...just wrong.

 

[montreid]

Has anyone had experience of ordering multiples and difference in build time? We have 2 reservations and prefer to have a less optioned car but don't want to miss out on the full credit either. Being California and in-store first day (non-owner), our hopes is to get an idea of priority cutoff and what options to take to ensure that; while also optioning the 2nd car at nearly base for the teenager's car.

Don't want to first our first car though if the two reservations are tied together in getting an order# and inline for production.

Anyone with thoughts on this?

 

[johnnyboy]

Hello, I reserved a model 3 on the 31st in store. I Never got an email and called Tesla to find out what happened...They input the wrong email so it may take a year for the email account to be linked up to my card number. Anyway, for those of you who did get an email, what info is on it? Build date? Anything? Im pretty much in the dark. Thanks!!

 

[Pollux]

Hi, @johnnyboy,

You're not missing much from the reservation email. It's a confirmation of how much money you paid and how many reservations were involved (e.g., 2 reservations @ total of $2000). There's a bunch of fine print about terms and conditions. Nothing around build date, other than to say that they expect to start production in "late 2017". No reservation numbers, either; to get those, you'll have to login to your MyTesla account. If you haven't already done so, you should do just that, so that you will be comfortable in the knowledge that your reservations are alive in the reservation system.

Alan

 

[johnnyboy]

Hi, @johnnyboy,

You're not missing much from the reservation email. It's a confirmation of how much money you paid and how many reservations were involved (e.g., 2 reservations @ total of $2000). There's a bunch of fine print about terms and conditions. Nothing around build date, other than to say that they expect to start production in "late 2017". No reservation numbers, either; to get those, you'll have to login to your MyTesla account. If you haven't already done so, you should do just that, so that you will be comfortable in the knowledge that your reservations are alive in the reservation system.

Alan

Thanks for the reply Alan, Im not sure how to login to "my tesla" since they didn't input my proper email. I was given a confirmation number, started with RN. anyway , hopefully I can see where Im at. thanks.