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Elon Musk Is Confident In Tesla’s Ability To Sell All The EVs It Makes

Tesla CEO Elon Musk is confident in Tesla’s ability to sell all of the electric vehicles it produces. Elon Musk’s answer on this was given in a recent interview with Financial Times interviewer Peter Campbell during the Financial Times Future of the Car summit. Campbell’s question was regarding Elon Musk’s purchase of Twitter and the effects it could have on Tesla. Campbell said:

“People will automatically associate you with Tesla and you with Twitter. Is there any risk in your mind that the actions that you’re going to take at Twitter, which you’ve admitted freely will upset some people, potentially lead to a commercial impact on Tesla?”

Elon Musk said that he was confident that Tesla would sell all of the cars that it produces and that it wasn’t demand that was an issue, but rather production capacity.

“I’m confident that we will be able to sell all the cars we can make. I mean, currently, the lead time for ordering a Tesla is ridiculously low. Our issue is not demand. It is production.”

Campbell noted that this was due to the global supply chains and the semiconductor chip shortages, and added that he expected EV demand to go through the roof. Elon Musk shared a bit more about consumer demand and how it’s affecting Tesla. He even brought up the possibility of not taking orders for anything beyond a period of time due to just how high the demand for Tesla EVs is.

“Even before there was the supply chain issues, Tesla’s demand exceeded production. So now its demand is exceeding production to a ridiculous degree. We’re actually probably going to limit — just stop taking orders for anything beyond a certain period of time because some of the timing is like, a year away.

“The frustration that we’re seeing for customers is being unable to get them a car; not are they willing or interested in buying a car. Basically, I think zero about demand generation and a lot about production and engineering and supply chain.”

Proof of High Demand for Teslas

Not only is the demand extremely high for Teslas right now, but even used Teslas are experiencing higher prices. InsideEVs noted that the valuations of used Tesla models not only follow the price increases for new models, but the long wait time for a new Tesla is a key factor. The latter is what drives new car buyers to the used car market. The article used data from Recurrent, which began tracking used car prices in April 2021. The data also shows that the price increases for a Model S were higher than for the Model 3.

According to Cars Direct, there are even cases of used Tesla models being more expensive than brand new ones. According to their research in the Southern California area, there was a 2020 Model Y Performance with 24,288 miles on it with a price tag of $81,100. In comparison, a new Model Y Performance starts at $69,190. The article also had comparisons for the Model 3 and the Model S. According to the article:

“A 2021 Model S Plaid with just under 4,000 miles costs $146,200. A current Model S Plaid is priced at $137,190. A 2016 P90D AWD model with 33,295 miles has a price tag of $77,900. A new Model S […] costs $101,190.”

If this sounds familiar, that’s because it is. In February 2022, I wrote this article about how used Tesla EVs in China were selling at a higher cost than brand new ones coming out of Giga Shanghai. The used car market in China is clearly benefitting from the semiconductor chip shortage and supply chain issues, and this has been reflected in the unusually high prices for used Teslas there. Fast forward three months, we are now seeing this ripple effect here in the States.

Elon Musk also brought up demand and production during Tesla’s Q1 2022 earnings call last month when he answered a question about price increases.

“Actually, on the price increase front, I should mention that it may seem like maybe we’re being unreasonable about increasing the prices of our vehicles, given that we had record profitability this quarter, but the waitlist for our vehicles is quite long. And some of the vehicles that people will order, the waitlist extends into next year.

“So, our prices of vehicles ordered now are really anticipating a supplier and logistics cost growth that we’re aware of and believe will happen over the next six to 12 months. So, that’s why we have the price increases today, because a car ordered today will arrive in some cases a year from now. So we have a very long waitlist. And we’re obviously not demand limited. We are production limited. Very much production limited.”

 

 

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Written By

Johnna owns less than one share of $TSLA currently and supports Tesla's mission. She also gardens, collects interesting minerals and can be found on TikTok

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