Tesla might have missed some of its earning results this quarter, but this does not mean the company is on the downturn. Far from it. Elon Musk’s baby has just revealed word that the upcoming affordable Tesla Model 3 is all set to enter production from the month of July 2017 onward. To sweeten the deal, there are also whispers on the ground that new locations for upcoming Gigafactories are being worked on, and these will be used to produce the lithium-ion batteries required for Tesla’s fleet of vehicles. The Gigafactories will also function as a production ground for batteries that will see action in the energy storage business. However, Tesla has not shared its full-year vehicle delivery targets at the moment, which continues to leave the industry guessing.
The Tesla Model 3 is touted to retail for a mere $35,000 where the base model is concerned, making the idea of a competitively priced fully electric car a viable one for families and singles alike. It would be critical for Tesla to roll out the Model 3 on schedule, since Tesla itself does not have a very good record to boast of when it comes to new vehicle deliveries. For instance, the Model X SUV? That model missed its initial launch date by more than one and a half years. Fingers crossed that the same will not happen to the Model 3.
Musk and Jason Wheeler, Tesla’s chief financial officer, shared in a letter to their shareholders, “Our Model 3 program is on track to start limited vehicle production in July and to steadily ramp production to exceed 5,000 vehicles per week at some point in the fourth quarter and 10,000 vehicles per week at some point in 2018.” Musk also made an announcement that Wheeler is set to leave Tesla this coming April. In his stead will be former CFO Deepak Ahuja, who has decided to return to the Tesla fold based on a long term agreement.
Right now, Tesla’s waiting list for the Model 3 stands at 400,000 people thereabouts. All of them had dropped $1,000 as an advance payment in order to reserve the Model 3, and this happened in 2016. So far, Musk has decided to keep mum on the latest figure where reservations are concerned, citing that it does not help the situation at all as speculation would probably cause more harm than good in the long run.
While the Tesla Model 3 is set to enter production in July this year, will there be actual deliveries of the vehicle in 2017? That is a very difficult question to answer, and hopefully Tesla will be more accurate in their assessment in time to come. After all, it is not nice at all to keep customers waiting. We do know that the Model S and Model X rides that could break the $100,000 ceiling in terms of price will see a delivery figure of 47,000 to 50,000 within the first half of the year.
Not only that, Tesla would want to improve its production processes so that it can handle up to 10 times more output over the course of the next three years. To achieve that, Tesla will work with Grohmann Engineering of Germany in order to develop more Gigafactories that will handle the increased demand for battery packs.
