Blog Tesla Deliveries Dipped in Q1

Tesla announced disappointing first-quarter delivery figures, a performance it says will negatively impact income.

Late Wednesday, Tesla said it delivered about 63,000 cars in Q1, versus analyst estimates of 76,000 deliveries. That’s down from 90,966 in the fourth quarter. Model 3 deliveries totaled 50,900, also below estimates. Tesla said it produced about 77,100 cars during the quarter.

“Because of the lower than expected delivery volumes and several pricing adjustments, we expect Q1 net income to be negatively impacted,” Tesla said in a release.

The company said complications during the rollout of the Model 3 internationally impacted its numbers.

“Due to a massive increase in deliveries in Europe and China, which at times exceeded 5x that of prior peak delivery levels, and many challenges encountered for the first time, we had only delivered half of the entire quarter’s numbers by March 21, ten days before end of quarter,” Tesla said in a release. “This caused a large number of vehicle deliveries to shift to the second quarter. At the end of the first quarter, approximately 10,600 vehicles were in transit to customers globally.”

The company noted that Model 3 was the best-selling mid-sized premium sedan in North America, selling 60% more units than the runner up. The company reaffirmed prior guidance of 360,000 to 400,000 vehicle deliveries in 2019.

“Despite pull forward of demand from Q1 2019 into Q4 2018 due to the step down in the federal tax credit, US orders for Model 3 vehicles significantly outpaced what we were able to deliver in Q1,” Tesla said.

See Tesla’s letter to investors here.

 

[King_M3D]

So Tesla deliveries are up 70% over first qtr '18 and the report is about how they've dropped over the end of year and end of full fed tax credit qtr.

 

[Cloxxki]

Tax credit was for entitled Americans. Tesla is a global brand. Where did the other customers go?
Tell me, who-ever you are, that you believe in your heart Tesla is wise to ignore all customer wishes that matter to them.
Tell me a Wagon version of the S is not years overdue and would have sold lots in Q1 here.
Tell me they is not gross incompetence at the very top of Tesla for not growing Model 3 production for more than percents since late Q2 2018?
Tell me it wasn't a blatant lie when Elon said S and X would remain tech leaders and flagships?

Here we are, nearly 2 years into Model 3, having added an unscheduled extra production line for it, and still we are not halfway 10k/week. Which car company with good demand ever performed this badly?

On my local investor forum the poster are calling me out. And I have to concede, this is extremely dire and there are no excuses.

I think I know some solution, extremely basic ones, but I see none of them even getting to a boardroom vote or even presentation before Musk steps down. His way or the highway, to hell with customer's wished. Pray, wait, wait more, buy, drive!

 

[Cloxxki]

So Tesla deliveries are up 70% over first qtr '18 and the report is about how they've dropped over the end of year and end of full fed tax credit qtr.

People love confusing stats.
Fact is, sales of all models fell.
Model 3 was produced slightly more in terms of cars. Well have to see the sales total as many fully loaded 3's went to Europe and Chine.
If year on year sales would be down in a "startup" company, that's the final blow. Yet, this could happened Q2 or Q3 now.
Musk's avenged 500,000 rate by end of 2019 tweet FU also is now in jeopardy. How are they going to ramp production so much when it's hit a ceiling 18 months before?

 

[Leafdriver333]

All I know is that I took delivery of my Model 3 on March 31st, and I have never had this much fun with a car.
I am a auto-phile and I have had multiple Miatae, BMW's, and Mini Cooper S's, GTI, etc.
But This Tesla tops them all.
I am a moving ad for Tesla as people notice my car everywhere.
It is only a matter of time before I see multiple Model 3's in my neighborhood..

 

[Alfred]

Fewer deliveries were to be expected due to the fundamental change in logistics with the startup of sales to Europe. Sales in Europe physically could only pick up from March and represent therefore about one month of sales. Tesla registers a sale when the car is with the customer and all papers are settled. A larger proportion than in previous quarters of production will be shifted into Q2 sales (as indicated in the communication). Cars on ships and trucks cannot make sales - even if production was within guidelines.

Whilst the first ships arrived in Antwerp in February, those cars had to be trucked then across Europe - not as simple as that sounds. Suitable trucks for this sudden increase in movements had to be scratched together from all across Europe. I noted trucks arriving in Switzerland registered in Lithuania and Estland. In one case I heard that one of those trucks had missed registering at customs on the border due to unfamiliarity with procedures. Those cars could not be delivered shortly anymore. Unpredictable arrival times and consequent erratic customs paper flows made delivery organisation very difficult. Remarkable was the mostly nearly perfect condition of the cars delivered - even as staff had hardly any time to check them as thoroughly as customary.

The complete ignorance and lack of understanding of such simple facts, particularly in the financial press, is amazing.

 

[R.S]

Fewer deliveries were to be expected due to the fundamental change in logistics with the startup of sales to Europe. Sales in Europe physically could only pick up from March and represent therefore about one month of sales. Tesla registers a sale when the car is with the customer and all papers are settled. A larger proportion than in previous quarters of production will be shifted into Q2 sales (as indicated in the communication). Cars on ships and trucks cannot make sales - even if production was within guidelines.

Whilst the first ships arrived in Antwerp in February, those cars had to be trucked then across Europe - not as simple as that sounds. Suitable trucks for this sudden increase in movements had to be scratched together from all across Europe. I noted trucks arriving in Switzerland registered in Lithuania and Estland. In one case I heard that one of those trucks had missed registering at customs on the border due to unfamiliarity with procedures. Those cars could not be delivered shortly anymore. Unpredictable arrival times and consequent erratic customs paper flows made delivery organisation very difficult. Remarkable was the mostly nearly perfect condition of the cars delivered - even as staff had hardly any time to check them as thoroughly as customary.

The complete ignorance and lack of understanding of such simple facts, particularly in the financial press, is amazing.

The fact is, that if you include vehicles in transit, they are still down from Q4 and not even at a 5k a week production rate with the 3. And another fact is, that S and X sales are horribly down.

Now is that the end of Tesla? Nope, but it also isn’t too great. A lot of high margin cars are missing in the mix and Tesla really needs the money.

In the end to me only the S and X sales are bad, but I didn’t expect Q4 sales in the US to continue for ever, like others. It will be interesting to see what happens when the half tax credit will again be halved in Q3. I guess Q2 sales could be rather good in the US and international. But if people decide to hype that again and they will, then they will have to live with the blowback from lower Q3 sales.

 

[SO16]

People love confusing stats.
Fact is, sales of all models fell.
Model 3 was produced slightly more in terms of cars. Well have to see the sales total as many fully loaded 3's went to Europe and Chine.
If year on year sales would be down in a "startup" company, that's the final blow. Yet, this could happened Q2 or Q3 now.
Musk's avenged 500,000 rate by end of 2019 tweet FU also is now in jeopardy. How are they going to ramp production so much when it's hit a ceiling 18 months before?

Perhaps you missed where Tesla stated they had hold ups during the first part of the quarter due to Model 3 deliveries in new markets. At least 10,000 plus cars will be delivered q2 because they couldn’t be done in q1 due to holdups.

Perhaps you also missed where Tesla dropped their two most popular models for S and X (with the lowest margin) which would most likely increase sales on a higher end and more profitable model.

Perhaps you also missed where q1 is historically lower than the rest of the year.

Not sure why people like you only look at a few months to determine the chicken little sky is falling narrative. We shall see how the rest of the year plays out.

 

[Cloxxki]

Perhaps you missed where Tesla stayed they had hold ups during the first part of the quarter due to Model 3 deliveries in new markets. At least 10,000 plus cars will be delivered q2 because they couldn’t be done in q1 due to holdups.

Perhaps you also missed where Tesla dropped their two most popular models for S and X (with the lowest margin) which would most likely increase sales on a higher end and more profitable model.

Perhaps you also missed where q1 is historically lower than the rest of the year.

Not sure why people like you only look at a few months to determine the chicken little sky is falling narrative. We shall see how the rest of the year plays out.

Oh actually I do know. You enjoy spreading FUD. Too bad so many idiots still believe your drivel. Kudos to you for finding suckers.

If they send as many cars to export markets again, as late again, there will be the same inventory. Indeed, sales will then roughly equalize with production. A slight up tick (Model 3) but still barely a production increase in then close to a year. Steep part of the S curve, right?
Yes, they discontinued popular cars. Let's congratulate Tesla for selling thousands fewer Model S and X, the cars they can actually build well and reliably, with high margin. No real update in years to what was promised to remain flag ships and tech leaders. False promises. They're outdated. And no plans to bring Model 3 battery tech there.

I look back only a few months because this is supposedly a rapidly growing company. Before long, the lack of growth in Model will even be seen year on year. Quarters pass and they can't get them made. Seems they intended to introduce SR but found they couldn't build SR+ fast enough even. +1,000 cars quarter to quarter, is that the steep part of the S curve to you?
At the 18Q3 earnings I think, it was declared they're be profitable here onward. What changed? Hugely higher raw materials and labor cost? Unexpected billions in fines? Force majeur at production? Non of those. Something has gone gravely wrong. And perhaps Deepak saw it coming and wanted no part in it? That's speculation on my part.

I feel it's an epic fail they allowed S and X sales to drop, become outdated. V3 should be introduced for those cars first, don't tell the public a 2017 Model 3 is more than 2 years ahead S and X. Someone does not get product management there. 3 cars on sale, selling billions a month. Seems worth to think about it before acting.
Sure, V3 announcement helped Model 3, but they cannot make that one quick enough. Shouldn't marketing and production efforts be aligned?
Their unscheduled hardware upgrades to cars are biting them now. S and X buyers don't want the last V2 2.5 cars. Would you? The potential for cost cutting on those cars are staggering and now at least 2 years overdue. That Model 3 battery and motor tech deserves to be in S and X. Efficiency, barely any power reduction when under hard loads, cheaper, pick all 3.

 

[SO16]

If they send as many cars to export markets again, as late again, there will be the same inventory. Indeed, sales will then roughly equalize with production. A slight up tick (Model 3) but still barely a production increase in then close to a year. Steep part of the S curve, right?
Yes, they discontinued popular cars. Let's congratulate Tesla for selling thousands fewer Model S and X, the cars they can actually build well and reliably, with high margin. No real update in years to what was promised to remain flag ships and tech leaders. False promises. They're outdated. And no plans to bring Model 3 battery tech there.

I look back only a few months because this is supposedly a rapidly growing company. Before long, the lack of growth in Model will even be seen year on year. Quarters pass and they can't get them made. Seems they intended to introduce SR but found they couldn't build SR+ fast enough even. +1,000 cars quarter to quarter, is that the steep part of the S curve to you?
At the 18Q3 earnings I think, it was declared they're be profitable here onward. What changed? Hugely higher raw materials and labor cost? Unexpected billions in fines? Force majeur at production? Non of those. Something has gone gravely wrong. And perhaps Deepak saw it coming and wanted no part in it? That's speculation on my part.

I feel it's an epic fail they allowed S and X sales to drop, become outdated. V3 should be introduced for those cars first, don't tell the public a 2017 Model 3 is more than 2 years ahead S and X. Someone does not get product management there. 3 cars on sale, selling billions a month. Seems worth to think about it before acting.
Sure, V3 announcement helped Model 3, but they cannot make that one quick enough. Shouldn't marketing and production efforts be aligned?
Their unscheduled hardware upgrades to cars are biting them now. S and X buyers don't want the last V2 2.5 cars. Would you? The potential for cost cutting on those cars are staggering and now at least 2 years overdue. That Model 3 battery and motor tech deserves to be in S and X. Efficiency, barely any power reduction when under hard loads, cheaper, pick all 3.

Wait another 6 months before getting your undies all twisted.

 

[jboy210]

I think the change in S and X sales is due to cannibalization from the 3 and anticipation of the Y, and the pull forward of the rush to get the last $7,500 tax credits in the US.

A lot of people bought the S and X because they wanted a Tesla sedan or CUV and those were the only choices. Now the 3 is out, and one can get a Performance for less than a base S. And if you wanted a CUV now maybe waiting 1.5 years for the Y is a viable alternative. For many buyers, the Y is a better option than an X. First, it does not cost a ton of money. Second, it is smaller so fits better in many locales. third, it is likely to be more efficient and cheaper to operate.

I just hope Tesla will not suffer from the "Osborne effect" with large number of buyers holding off until the release of the Y. Sales of the 3 other models (S,X,3) could be impacted by this.

 

[Cloxxki]

Wait another 6 months before getting your undies all twisted.

Explain that to investors who listen in to quarterly earning calls.
How can the fastest growing car brand...NOT GROW?
The trend has now been broken. Less than half the S/X sales than a year ago, that's not seasonal. That's mismanagement.
Or are there suddenly lots of competitors on the markets stealing sales off Tesla with premium sedan BEVs?

 

[SO16]

Explain that to investors who listen in to quarterly earning calls.
How can the fastest growing car brand...NOT GROW?
The trend has now been broken. Less than half the S/X sales than a year ago, that's not seasonal. That's mismanagement.
Or are there suddenly lots of competitors on the markets stealing sales off Tesla with premium sedan BEVs?

I’m an investor who’s long. (Several years and will hold several years). I could give a *sugar* about 3 months. People who only look at a month or quarter does not invest in the company. They invest to make a quick profit and to move on to something else. And I could give a rats a$$ about them. This monthly and quarterly crap is just noise.

 

[Cloxxki]

I’m an investor who’s long. (Several years and will hold several years). I could give a *sugar* about 3 months. People who only look at a month or quarter does not invest in the company. They invest to make a quick profit and to move on to something else. And I could give a rats a$$ about them. This monthly and quarterly crap is just noise.

You have that right. There are however clearly also people who rely on stock trading for a living. They deserve fair estimations and proper management.

TSLA of course, is a public company and get to adhere to long established laws and regulations.
If that's a problem, or the company can only deal with permalongs, go private. Indiegogo.

 

[ricohman]

Tax credit was for entitled Americans. Tesla is a global brand. Where did the other customers go?
Tell me, who-ever you are, that you believe in your heart Tesla is wise to ignore all customer wishes that matter to them.
Tell me a Wagon version of the S is not years overdue and would have sold lots in Q1 here.
Tell me they is not gross incompetence at the very top of Tesla for not growing Model 3 production for more than percents since late Q2 2018?
Tell me it wasn't a blatant lie when Elon said S and X would remain tech leaders and flagships?

Here we are, nearly 2 years into Model 3, having added an unscheduled extra production line for it, and still we are not halfway 10k/week. Which car company with good demand ever performed this badly?

On my local investor forum the poster are calling me out. And I have to concede, this is extremely dire and there are no excuses.

I think I know some solution, extremely basic ones, but I see none of them even getting to a boardroom vote or even presentation before Musk steps down. His way or the highway, to hell with customer's wished. Pray, wait, wait more, buy, drive!

A wagon version of the 3 with a hitch!

 

[SO16]

You have that right. There are however clearly also people who rely on stock trading for a living. They deserve fair estimations and proper management.

TSLA of course, is a public company and get to adhere to long established laws and regulations.
If that's a problem, or the company can only deal with permalongs, go private. Indiegogo.

I REALLY wish they would go private. I’m tired of all the distractions due to it being public. Sure, Elon would still be Elon but at least shorts would no longer have an incentive to bash this company quite so incessantly.

 

[Uncle Paul]

Statistic that most impresses me is that Tesla production has increased 110% from the same quarter last year.

4th quarter 2018 was an all out effort to deliver as many cars as physically possible before the end of the full tax credit.

Now they have regrouped, repriced, improved quality and moved some resources to building out service, rolling out computer improvements and generally getting the operation smoother running. The volume will come more naturally as they mature. Production, delivery and logistics Hell will all be resolved going forward.

Some investment groups are obviously anti-Tesla. Their intent is to make money by having it fail. Not going to happen.

 

[Cloxxki]

I REALLY wish they would go private. I’m tired of all the distractions due to it being public. Sure, Elon would still be Elon but at least shorts would no longer have an incentive to bash this company quite so incessantly.

No such thing as shorts. Tesla is a drama magnet. All it needs is well timed bad news and you have lovely sawtooth price action. Those you call shorts go long on dips as well. One time they'll get it wrong but the profit has already made on all the repeated up/downs in a wide but predictable range.
The stock is still too high for a car maker than is killing well selling products, never did anything on time, gets loans after saying they'll self-fund and books huge loss after declaring permanent profitability hereonward.
Investors do not get dividends, plenty of dilutions. No reason the stock should be this expensive. Look at how cheap Maxwell got to be and they even something worth billions.

 

[Cloxxki]

Statistic that most impresses me is that Tesla production has increased 110% from the same quarter last year.

While interesting, it came at a cost of how many billions in investment and should have occurred at least half a year earlier.
Brand makes two series items and introduces mass item. OF COURSE there is year on year growth. But if that can't generate profits, it's extremely dire. Especially if now almost 2 years into Model 3, they're at the production rate scheduled for late 2017. So they awe the cars they CAN make reliably, 75D. Saves costs, surely, but reduces S/X sales year on year by >50%. Why not just discontinue those cars? All that cost! Utter lack of product management. Devastatingly bad decision to not have an S wagon with tow hitch. All about the mission, refusing to do sound business?

 

[SO16]

No such thing as shorts. Tesla is a drama magnet. All it needs is well timed bad news and you have lovely sawtooth price action. Those you call shorts go long on dips as well. One time they'll get it wrong but the profit has already made on all the repeated up/downs in a wide but predictable range.
The stock is still too high for a car maker than is killing well selling products, never did anything on time, gets loans after saying they'll self-fund and books huge loss after declaring permanent profitability hereonward.
Investors do not get dividends, plenty of dilutions. No reason the stock should be this expensive. Look at how cheap Maxwell got to be and they even something worth billions.

When people like Chanos and several other known shorts giving interview to bash the company, I have a problem with that. If they wanted to bet against the company quietly, that’s fine. But when they purposely instill FUD, that’s ridiculous.