Tesla Model 3 - Make or Break ??

Last month I heard on an auto TV program - no, don't remember which one - that the car most often sold or traded in by purchasers of a Tesla 3 is a BMW 3 series. I don't know what this means to Tesla or BMW but I suppose they are both keenly aware of it.

 

The chart that Tesla showed yesterday certainly seems to agree with that, and I would think it means bad things for BMW. Oddly it doesn't seem to be effecting Audi or Lexus at all.

 

Of those cars, the BMW is by far the oldest in its current generation. The current 3 series debuted in 2011 and sales are expected to decline by the end of its lifecycle. The current C-class debuted in 2015 and A4 in 2016. The IS is starting to get old having debuted in 2013, but it was never a major player and hasn't sold many. It's only natural for a brand new model to go up in %market while a very old one to go down. No one will trade in their latest generation 2016 A4 for a Model 3, but a 5 year old 3 series no problem.

 

How does Tesla work a trade-in when they don't have dealers/used car showrooms?

I hadn't considered how recent a car was updated as a reason to go Tesla......I was thinking BMW and Tesla prospects want to be the cool kids on the block.....?

 

i bet the refunds are also a way to reduce the waitlist for base cars, when their goal is to sell the loaded model 3's.

in any case, this was a bad day for the shorts....

 

They just sell them at auction, which is frequently what other new car dealers do as well. If it is a Tesla that's being traded in, they will resell those.

 

Tesla Model 3 Is Laps Ahead Of Other US Plug-In Cars (US Electric Car Sales Report)

June 9th, 2018


The Tesla Model 3 continues to open up its lead over every other plug-in car on the US market*. For all the hype about a slower than projected Model 3 production ramp up, it seems there isn’t another plug-in vehicle that comes within two laps of touching it. It sits at about triple the sales of the #2 Toyota Prius Prime (a plug-in hybrid) and nearly 4 × the sales of all 7 of BMW Group’s plug-in models combined.

Why does the Tesla Model 3 get so much attention? Look at its sales! Furthermore, consider the fact that these are expected to double (or go even further).

Many people did wonder if the Model 3 would raise awareness about electric cars enough that it would also increase demand for other electric models on the market. This has always been a big question since the other models don’t benefit from the same overall package that the Model 3 offers, but a Model 3 isn’t for everyone and simply making more people aware that cool electric cars exist could lead to sales of other models.

BMW Group, mentioned above in a less positive light, is actually one of the companies doing the best on the plug-in vehicle scene. It saw a 27% increase of plug-in hybrid vehicle sales in May and 75% from January through May. BMW i3 sales were down 16% in May, but they were up 21% January through May. The Toyota Prius Prime is also scoring a lot more points. Its sales were up 53% in May and 49% in January through May, while the Chevy Bolt is in a similar place as the i3 — sales were down 28% in May but up 14% January through May.

Otherwise, non-Tesla plug-in vehicle sales were down across the board in May and January–May for the models we’re able to track*.

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In any case, if you look at the May 2018 chart at the top, it’s clear that there’s now the Model 3 and everyone else. That also now reminds me of the stunning chart Tesla shared last week forecasting the battery capacity in electric vehicles expected to be shipped in Q3 2018 (globally):

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The market is a changing. I still love a bunch of the electric cars that are available on the market, and could recommend many of them depending on a person’s circumstances, preferences, and needs. But Model 3 is king of the hill now, and it’s hard to see that changing until the Model Y comes along in a few years.

*There are several automakers that don’t break out sales of their electric models (for example, sales of the Kia Niro PHEV are hidden within overall sales of the Kia Niro and Hyundai Ioniq EV sales are hidden within overall sales of the Hyundai Ioniq). As such, we have little insight into how many of these cars are sold in the US. Rather than guess, we exclude them from these monthly reports.

However, Tesla makes various statements about sales from time to time and offers some quarterly numbers, and Tesla vehicles are a more significant part of the EV market, so I create estimates based on every Tesla statement I can find as well as Tesla registration data in Europe and China. But do note that Tesla doesn’t publicly break out monthly sales and doesn’t break out country-by-country sales, so these estimates are definitely not precise.




https://cleantechnica.com/2018/06/09/tesla-model-3-is-laps-ahead-of-other-us-plug-in-cars/

 

Tesla shares rise after analyst raises Model 3 delivery estimate by 50%

June 12, 2018

• KeyBanc Capital Markets raises its second-quarter Model 3 delivery estimate to 30,000 from 20,000, citing its conversations with Tesla dealers.
• The firm reiterates its sector weight rating for the company's shares due to its valuation.

Tesla is making significant progress in ramping up production of its Model 3 electric car, according to one Wall Street firm.

KeyBanc Capital Markets significantly raised its second-quarter Model 3 delivery estimate to 30,000 from 20,000, citing its conversations with Tesla dealers.

"Our checks with sales centers indicate Model 3 deliveries are tracking ~50% higher than our prior estimates for the quarter, prompting us to raise our estimates," analyst Brad Erickson said in a note to clients Monday. "While the longer-term debate on TSLA remains more balanced … we maintain that evidence supporting the bear case is not likely to emerge in the near term, in our view."


Tesla's stock is up 2.4 percent in Tuesday's premarket session. Its shares rose 6.7 percent this year through Monday versus the S&P 500's 4.1 percent gain.

Last week CEO Elon Musk said it is "quite likely" the company will hit a weekly Model 3 production rate of 5,000 cars by the end of the month. Tesla has struggled with production issues with the vehicle.

Erickson noted his conversations with sales representatives at 20 Tesla stores revealed Model 3 deliveries for the second quarter are pointing to higher than his previous expectations. As a result, he also increased is full year Model 3 delivery estimate to 118,182 from 98,182.

"We believe weekly run-rate volumes have moved from the high teens per store per week to the low 30s since our last checks in mid-April," he said.

The analyst reiterated his sector weight rating and $300 "fair value" price target for Tesla shares, representing 10 percent downside to Monday's close.

"Long-term thesis on TSLA unchanged," he said. "Our rating is built on the core belief that there is significant premium built into the stock on perceptions of the Company's innovative superiority around the five critical aspects of the story: manufacturing, batteries, software, AI, and competition."




TSLA 332.10



https://www.cnbc.com/2018/06/12/tesla-shares-rise-after-analyst-raises-model-3-delivery-estimate-by-50-percent.html

 

Tesla to Cut Workforce by 9%; Musk Says It Won’t Affect Model 3 Production

June 12, 2018

The latest round of layoffs come as part of a comprehensive restructuring effort, which includes ending solar sales at Home Depot.

Tesla CEO Elon Musk told employees this week the company plans to make significant job cuts as part of a comprehensive restructuring effort.

"[W]e have made the difficult decision to let go of approximately 9% of our colleagues across the company," Musk wrote in an email to all staff. "These cuts were almost entirely made from our salaried population and no production associates were included, so this will not affect our ability to reach Model 3 production targets in the coming months."

Last month, Musk warned employees in a separate letter obtained by Electrek that Tesla is undertaking a "reorg" that would flatten the management structure and trim activities "that are not vital to the success of our mission." This week's layoff announcement sheds more light on that strategy, as Tesla strives to achieve profitability by the end of the year.

Musk acknowledged the job cuts in a tweet today, shortly after news leaked to the media.



https://www.greentechmedia.com/articles/read/tesla-lay-off-9-workforce-musk-says-wont-affect-model-3-production?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+greentechmedia%2Fnews+%28Greentech+Media%3A+News%29#gs.xARYTC0

 

Analyst Calculates Tesla Model 3 Cancellation Rate Is A Disastrous 66%

Thu, 06/14/2018


Vertical Group's Gordon Johnson is hardly on Elon Musk's holiday card list: two months ago, Johnson explained why, far worse than even more analyst estimates, there was a gaping $3.4 billion funding hole in Tesla's balance sheet. Well, after yesterday's glaring attempt at stock manipulation deep value investing by Elon Musk, Johnson is now officially at the top of Musk's **** list because overnight the outspoken and contrarian analyst just downgraded Tesla to a street-low price target of $93 (from the not that much more generous $99 target previously).

Why did the Vertical Group analyst take a machete to his price target?

One main reason: according to Johnson's calculations, the cancellation rate on Model 3 is a disastrous 66%, up 33% YTD, or as Gordon says, "Boy… that’s a Lot of Model 3 Cancellations."

Here are the details from Gordon:



https://www.zerohedge.com/news/2018-06-14/analyst-calculates-tesla-model-3-cancellation-rate-disastrous-66

 

358

 

370.83

 

352.55

Of interest, Fisker launches its EMotion EV in 2019 as a direct rival to the Model 3.

Fisker has patented its 'Fisker Flexible Solid-State Battery', which has a capacity 2.5 times greater energy density than a Lithium-Ion battery.


Below - Fisker EMotion

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I'd like to learn about Fisker's battery tech, but their patent has non-publication request as it's pending approval...

 

Question is when do they expect to actually use their own battery...?

SV

 

I can't edit my post this late, but I now have doubts on Fisker's battery tech. Seems like Sakti3 patents (3 of them) were dropped by Dyson after not being as good as anticipated. Seems like the recurring theme in the business of battery advancement (or lack thereof). The scientist Fisker worked with for the patent is from Sakti3. I was about to say that if their numbers were accurate on that tech they should not be building cars, but rather licensing that out to basically replace most batteries on earth. Not gonna happen.

 

'Words Fail Me. It’s Insanity.' While Elon Musk Loves Tesla's New Tent Factory, Others Aren't So Sure


By Bloomberg June 25, 2018

Elon Musk has six days to make good on his pledge that Tesla will be pumping out 5,000 Model 3 sedans a week by the end of the month. If he succeeds, it may be thanks to the curious structure outside the company’s factory. It’s a tent the size of two football fields that Musk calls “pretty sweet” and that manufacturing experts deride as, basically, nuts.

“Words fail me. It’s insanity,” said Sanford C. Bernstein & Co.’s Max Warburton, who benchmarked auto-assembly plants around the world before becoming a financial analyst.

Inside the tent in Fremont, Calif., is an assembly line Musk hastily pulled together for the Model 3. That’s the electric car that is supposed to vault Tesla from niche player for the wealthy to high-volume automaker, bringing a more affordable electric vehicle to the masses.

Tesla has had a heck of a time making the leap. Musk’s expectation two years ago was that 100,000 to 200,000 Model 3s would be produced in the second half of 2017. Just 9,766 rolled out in the first quarter—a weekly output rate of roughly 750.

Hence, apparently, the tent. Musk announced it on Twitter on June 16, saying the company had put together an “entire new general assembly line” in three weeks with spare parts; the building permit was issued on June 13, though the company could have started working on aspects of the project before that.

Whether this new line is fully operational is unclear. Company officials declined to comment. The Tesla-obsessed users of Twitter and other internet forums have posted photos and videos and comments either praising or ridiculing the parking-lot big top. Apparently in response to the intense interest, the tent has recently been surrounded by very large trucks, which obstruct the view.

When Tesla releases second-quarter production and delivery figures in early July, the hundreds of thousands of customers who’ve been waiting since March 2016 for their Model 3s, having put down $1,000 deposits, will get a better sense of how much longer they’ll be in the queue. “The question is, how much rope Musk will get from customers who have had to wait years for delivery?” said Jeff Liker, a University of Michigan engineering professor who’s written books on Toyota Motor Corp.’s vaunted production system.

What gives manufacturing experts pause about Tesla’s tent is that it was pitched to shelter an assembly line cobbled together with scraps lying around the brick-and-mortar plant. It smacks of a Hail Mary move after months of stopping and starting production to make on-the-fly fixes to automated equipment, which Musk himself has said was a mistake.

“The existing line isn’t functional, it can’t build cars as planned and there isn’t room to get people into work stations to replace the non-functioning robots,” Warburton said in an email. “So here we have it—build cars manually in the parking lot.”

An admission in April that he erred by putting too many robots in Tesla’s plants was a humbling moment for Musk. The chief executive officer had boasted in the past that his company would build an “alien dreadnought,” sci-fi bro code for a factory so advanced and robotic, it would be incomprehensible to primitive earthlings.

During a February earnings call, Musk told analysts that Tesla had an automated-parts conveyance system that was “probably the most sophisticated in the world.” But by the spring, it had been ripped out of the factory.

“We had this crazy, complex network of conveyor belts,” Musk told CBS This Morning in April. “And it was not working, so we got rid of that whole thing.”

James Womack, the founder of the Lean Enterprise Institute in Cambridge, Massachusetts, called Tesla’s haphazard approach worrisome. “The chaos of how Musk is going about this makes it difficult for him to provide the standardized, repeatable work routines that allow people to function,” said Womack, author of The Machine That Changed the World, which sprang from an influential study of Toyota’s production techniques. “He’s going to need a second tent for repair and rework.”

The word “temporary” may be in Tesla’s tent permits with Fremont, but Musk has suggested it could stick around a while. He told one Twitter follower last week that he’s not sure the company actually needs a building anyway. He described the new assembly line as “way better” than the one in the plant that cost the company hundreds of millions.

That tweet spoke volumes to Dave Sullivan, an analyst at research firm AutoPacific who used to supervise Ford Motor factories. “To say that it’s more efficient to build this with scrap pieces laying around means that either somebody made really bad decisions with the parts in the plant inside, or there are a lot of other problems yet to be discovered with Tesla’s efficiency.”

Fremont is working closely with Tesla to make sure that the tent is in compliance with building and fire codes, said Gary West, an official for the city. Tesla applied for a building permit to erect the tent on June 7, according to municipal records. A permit has been issued for equipment installation and one for an overhead fire sprinkler system is pending. The tent doesn’t have air conditioning, according to the city documents.

The tent was supplied by a company called Sprung, which refers to its products as “high performance tensioned membrane structures” and constructed the facility that housed the NASA Space Shuttle in the 1980s. The one at Tesla covers 137,250 square feet. Building plans show that it’s adjacent to the factory’s north paint shop; it’s visible from the platform of the Warm Springs BART station.

The assembly line inside will start out as fully manual and gradually convert to automation in steps, according to Brian Johnson, an analyst at Barclays who met with Tesla’s investor relations department last week.

“It’s preposterous,” Bernstein’s Warburton said. “I don’t think anyone’s seen anything like this outside of the military trying to service vehicles in a war zone. I pity any customer taking delivery of one of these cars. The quality will be shocking.”



http://fortune.com/2018/06/25/elon-musk-tesla-tent-factory-model-3/

 

Max Warburton has been hating on everything that Tesla does for as long as I can remember. Every few months he comes out with something new to pick at with them. Not surprising as it probably drives a huge amount of publicity for his firm.

Might as well be asking MSNBC what they think of Trump.

 

It does look and sound a little crazy!

 

Lets look at this logically. They set up this tent how many weeks before the 5000 CPW deadline ? Four ? Six ? Whatever it was shows a last minute urgency which also shows no proper organizational ability. If the tent was needed what was it done at the last minute ?

There is zero chance Tesla can build quality cars in that tent. Zero.

 

So the Tesla circus of Model 3 production shortcomings continues literally...

 

Tesla's all-nighter to hit production goal fails to convince Wall Street

July 2, 2018


(Reuters) - Tesla Inc’s (TSLA.O) burning the midnight oil to hit a long-elusive target of making 5,000 Model 3 vehicles per week failed to convince Wall Street that the electric carmaker could sustain that production pace, sending shares down 2.3 percent on Monday.

Tesla met the target by running around the clock and pulling workers from other projects, workers said. The company also took the unprecedented step of setting up a new production line inside a tent on the campus of its Fremont factory, details of which Chief Executive Elon Musk tweeted last month.

Tesla’s heavily-shorted shares rose as much as 6.4 percent to $364.78 in early trading, but sank after several analysts questioned whether Tesla would be able to sustain the Model 3 production momentum, which is crucial for the long-term financial health of the company.

“In the interim, we do not see this production rate as operationally or financially sustainable,” said CFRA analyst Efraim Levy. “However, over time, we expect the manufacturing rate to become sustainable and even rise.

Levy cut CFRA’s rating on Tesla stock to “sell” from “hold.”

• Tesla shares fall after automaker hits production milestone

Tesla, which Chief Executive Elon Musk hailed on Sunday as having become a “real car company,” said it now expects to boost production to 6,000 Model 3s per week by late August, signaling confidence about resolving technical and assembly issues that have plagued the company for months.

Tesla also reaffirmed a positive cash flow and profit forecast for the year and announced that Doug Field, senior vice president of engineering, was stepping down after five years with the company.

Tesla has been burning through cash to produce the Model 3. Problems with an over-reliance on automation, battery issues and other bottlenecks have potentially compromised Tesla’s position in the electric car market as a host of competitors prepare to launch rival vehicles.

While UBS analyst Colin Langan said there was some relief the company hit the Model 3 production target, he noted that second-quarter vehicle deliveries of 40,740 missed his expectation for 51,000 and the consensus estimate of 49,000.

He also questioned whether the company could keep up the faster production and its profit outlook.

“We’re very worried about quality and if you read the reports online there’s significant quality issues. They still haven’t proven they can produce these profitably. The math is very challenging in getting to a sustained profit,” said Langan.

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Model 3 production tripled to 28,578 in the company’s second quarter from the previous quarter, Tesla said.

The company said 11,166 Model 3 vehicles were in transit to customers at the end of the second quarter, and would be delivered early next quarter.

Reservations at the end of the second quarter stood at roughly 420,000. Tesla has delivered 28,386 Model 3 cars to date. Model 3 reservations totaled 450,000 at the end of the first quarter.

Tesla Inc335.07
TSLA.ONasdaq
-7.88(-2.30%)
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• TSLA.O

The company said it expects orders to grow faster than the production rate after it starts allowing potential customers to see and test drive Model 3s at local stores.

Despite originally touting the Model 3 as a $35,000 vehicle, Tesla has yet to begin building that basic version and instead is currently building a higher-priced model as it tries to come out of “production hell.”

The prices of Tesla’s three convertible bonds were little moved by hitting the production goal, suggesting that share price volatility discouraged bondholders from converting their securities into equity despite the positive production news.

As of Friday’s close, 34.83 million Tesla shares or 27.5 percent of the shares available for trading were sold short and investors did not appear to be covering their positions ahead of Monday’s announcement, according Ihor Dusaniwsky, managing director at S3 Partners a financial analytics firm.

“You wonder are traders maxed out on risk on Tesla. At a certain point you’re gorged. You can’t take another bite,” he said.

Tesla’s milestone achievement did not alter a recommendation to short Tesla stock from David Kudla, founder and chief executive of Mainstay Capital Management in Grand Blanc, Michigan. Selling shares short is a bet the price will fall.

“The push to meet these self-imposed targets makes one question what cost was incurred to build these cars and how was quality adversely impacted,” said Kudla, who is personally short Tesla stock.

“Whether somebody is short at $361 or $300 they’re going to be fine.”

Reporting by Supantha Mukherjee in Bengaluru and Sinead Carew in New York: Additional reporting by Kate Duguid in New York and Munsif Vengattil in Bengaluru; Editing by Tom Brown, Alden Bentley and Lisa Shumaker


https://uk.reuters.com/article/us-tesla-production/teslas-all-nighter-to-hit-production-goal-fails-to-convince-wall-street-idUKKBN1JS1IE

 

Mercedes to overtake Tesla as electric vehicle market leader, says PA Consulting

11/07/2018 in Manufacturer News




Tesla is predicted to sell the most electric cars in 2019, but by 2021, Mercedes – fifth in the global ranking in 2019 – will become the market leader in EV production, predicts PA Consulting.

By 2021, Tesla is expected to fall to seventh place, with German carmakers – Mercedes, BMW and VW – coming first, second and fourth respectively. Renault Nissan Mitsubishi are expected to be ranked third.

Tesla, says PA Consulting, faces an uncertain future due to production problems of Model 3 and its profit expectations.


However, the electric carmaker may be able to overcome some of those issues after signing an agreement with Chinese authorities to build a factory in Shanghai. The "Gigafactory" would be Tesla's first outside of the US.

It intends to be producing 500,000 vehicles within five years of construction, which is due to start in the "near future", the company said in a statement.

To build the ranking, PA Consulting scored six key success factors out of 100, using an average to determine a car maker’s e-mobility potential:

• Technology and strategy (model portfolio and technology roadmap) – 30% weighting factor

• Battery technology (cost position and technology maturity) – 20% weighting factor

• Culture and incentives (leadership and incentive system) – 10% weighting factor

• Supplier network (value chain integration) – 15% weighting factor

Thomas Goettle, head of automotive at PA Consulting, said: “Achieving CO2 targets and improving car makers’ future mobility performance score go hand in hand. However, this call to action will come with a huge impact on the companies’ staff resources.

“Our research shows that the roles of 267,000 employees at 16 brands across Europe will be under threat, of which 141,000 employees may need re-qualification – all within the next decade.”

He continued: “To improve their future mobility performance score and meet CO2 targets by 2021, car makers should not only accelerate and realign their new product development, they need to consider value creation in their supply chain and increase sales by customer focus.”



https://www.fleetnews.co.uk/news/manufacturer-news/2018/07/11/mercedes-to-overtake-tesla-as-electric-vehicle-market-leader-says-pa-consulting