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I would have more confidence in this announcement if it was not made a day before Tesla announced that they are experiencing falling demand for their existing l

I would have more confidence in this announcement if it was not made a day before Tesla announced that they are experiencing falling demand for their existing line and barely hit the bottom of their production forecast. Their initial "hand over" is to employees, not real customers, so it is really just internal testing and does not indicate anything about when actual deliveries will begin. Hitting delivery deadlines is actually worse than missing them if you are hitting them by pushing an unfinished product which is losing tons of money per unit due to inefficient production processes and creating huge future liabilities for warranty repairs, recalls, and negligence lawsuits if someone gets injured by a defect. There is a reason why Goldman is revising their price target down on this news and their target is half the current stock price.

mikeash 9y ago
Those employees are still paying their own personal money for the car. They're as much "real customers" as you or me.
- davewritescode 9y ago
  I suspect they're not paying what customers will pay and they're likely to be leases since they're effectively pre-production models and you'd have to be a big knucklehead to bet on the resale value of a pre-production Model 3.
  - mjamesaustin 9y ago
    Tesla offers zero employee discounts on their cars. Even Musk pays full price, on principle. https://www.quora.com/Do-Tesla-employees-get-a-discount-on-Tesla-cars https://www.quora.com/Do-Tesla-employees-get-a-discount-on-T...
  - greedo 9y ago
    I imagine the value of a pre-production Model 3 will be quite good in ten years. Look at what the iPhone (original release) is worth. Or perhaps a Ford Model T?
bjelkeman-again 9y ago
Falling demand, really? "After delivering 25,051 vehicles during the first quarter, it pushes deliveries to “approximately 47,100” according to the company. [For the year.] It represents a 53% increase over deliveries during the same period last year and both Model S and Model X deliveries were higher than during Q2 2016" Maybe a plateau could be argued looking at the graph here. https://electrek.co/2017/07/03/tesla-delivers-vehicles/ https://electrek.co/2017/07/03/tesla-delivers-vehicles/
- calafrax 9y ago
  "After delivering 25,051 vehicles during the first quarter" ... they delivered 22,000 vehicles in the second quarter. That sounds like a 12% decline to me. It sounds like a 12% decline to Goldman Sachs. I am not sure what you call it.
  - bjelkeman-again 9y ago
    Car sales can be seasonal, or like Tesla said in their press release, they where supply constrained by their new 100 kWh battery. Just comparing numbers from the last two quarters is not really very informative. The previous quarter was an increase, the one before that a decrease, the one before that a substantial increase. More important is a trend. And I see a plateau when looking at the mast four quarters.

mikeash 9y ago

Those employees are still paying their own personal money for the car. They're as much "real customers" as you or me.

davewritescode 9y ago
I suspect they're not paying what customers will pay and they're likely to be leases since they're effectively pre-production models and you'd have to be a big knucklehead to bet on the resale value of a pre-production Model 3.
- mjamesaustin 9y ago
  Tesla offers zero employee discounts on their cars. Even Musk pays full price, on principle. https://www.quora.com/Do-Tesla-employees-get-a-discount-on-Tesla-cars https://www.quora.com/Do-Tesla-employees-get-a-discount-on-T...
- greedo 9y ago
  I imagine the value of a pre-production Model 3 will be quite good in ten years. Look at what the iPhone (original release) is worth. Or perhaps a Ford Model T?

bjelkeman-again 9y ago

Falling demand, really? "After delivering 25,051 vehicles during the first quarter, it pushes deliveries to “approximately 47,100” according to the company. [For the year.] It represents a 53% increase over deliveries during the same period last year and both Model S and Model X deliveries were higher than during Q2 2016" Maybe a plateau could be argued looking at the graph here. https://electrek.co/2017/07/03/tesla-delivers-vehicles/ https://electrek.co/2017/07/03/tesla-delivers-vehicles/

calafrax 9y ago
"After delivering 25,051 vehicles during the first quarter" ... they delivered 22,000 vehicles in the second quarter. That sounds like a 12% decline to me. It sounds like a 12% decline to Goldman Sachs. I am not sure what you call it.
- bjelkeman-again 9y ago
  Car sales can be seasonal, or like Tesla said in their press release, they where supply constrained by their new 100 kWh battery. Just comparing numbers from the last two quarters is not really very informative. The previous quarter was an increase, the one before that a decrease, the one before that a substantial increase. More important is a trend. And I see a plateau when looking at the mast four quarters.