Published on December 16th, 2017 | by Zachary Shahan0
Is Tesla Model 3 Production Gliding Into 5,000 Cars A Week?
December 16th, 2017 by Zachary Shahan
There have now been multiple claims that Tesla staff members are telling Tesla customers that Tesla is sending out Model 3 configuration invites to batches of 5,000 at a time. If that’s true, it seems that 5,000 email invitations were sent in the past few days, 5,000 were sent approximately a week before that, and 5,000 were sent around November 21–22, going by crowdsourced information in this Google Sheet.
Assuming that information is correct, the first conclusion I’m inclined to jump to is probably a common one — that 5,000 email invitations a week means Tesla is now or very soon going to be producing 5,000 Model 3 electric cars a week. However, that doesn’t actually make sense. Many people — like our own Kyle Field — are not ordering the Long Range Model 3 + Premium Package. If not ordering the Long Range Model 3 + Premium Package, the customer has to wait, since the first cars being produced and shipped are just Long Range Model 3 + Premium Package cars.
Of course, some customers will also discover or decide that getting a Model 3 doesn’t actually make sense for them (perhaps their finances changed or just aren’t where they hoped). Perhaps they had to go get another car sooner, like our own Jose Pontes, who went with a Kia Soul EV.
We don’t have any decent sense of what percentage of customers are now cancelling orders (after getting invites), deferring (which is also an option), or ordering lower-cost Model 3 packages that will be produced and delivered in later months. The figure could be 20%, or it could be 80%.*
With those caveats in mind, Tesla is almost definitely not producing 5,000 Model 3s a week right now, but it seems to be getting much closer and is potentially already producing thousands a week (maybe 3,000 a week, as one reader postulates).
We will get much more insight into actual production and delivery numbers once people who got the invites start receiving delivery dates and then their cars. However, that still won’t tell us what we actually want to know — how many Model 3s are being fully produced each week. Hopefully Tesla will share that information just after the first of the year when it shares total quarterly production and deliveries.
One other piece of information that’s useful — potentially most useful for evaluating Tesla’s ability to identify and solve the problems that held up production — is one from a month and a half ago. After it was clear that the Model 3 production schedule got delayed, Tesla noted in a quarterly report on November 1, “We currently expect to achieve a production rate of 5,000 Model 3 vehicles per week by late Q1 2018.”
What does that information combined with the information above tell us? Well, I’ll rope in a few more numbers to hypothesize and prognosticate. If we jump into the wayback machine (or the not-so-wayback machine), you may recall that Tesla CEO Elon Musk tweeted on July 3 that Tesla was aiming to reach a production run rate of 20,000 Model 3 cars a month (aka 5,000 a week) in December 2017 (this month). That would be after a ramp that saw 100 produced in August and 1,500 produced in September. Our own Loren McDonald filled in the gaps to estimate 5,000 Model 3s produced in October and 10,000 in November.
If 15,000 Tesla Model 3 configuration invites did indeed go out from late November until this week, I think we can conservatively assume Tesla plans to produce 5,000 Model 3 Long Range + Premium Package cars this month, which would mean 10,000 in January based on the ramp schedule Loren previously shared. That would put the company on track to produce 20,000 or so in February, matching up with Tesla’s stated target of 5,000 Model 3 vehicles per week by late Q1 2018. Even if you push off the 5,000 per month production estimate to January instead of December, that leaves Tesla hitting 5,000 per week in March 2018 — if you follow the initial production ramp expectations and assume no more unexpected bottlenecks.
* Yes, 20% and 80% are the only options.