Tesla Q3 2016 Production and Deliveries

PALO ALTO, CA -- (Marketwired) -- 10/02/16 -- Tesla (NASDAQ: TSLA) delivered approximately 24,500 vehicles in Q3, of which 15,800 were Model S and 8,700 were Model X. This was an increase of just over 70% from last quarter's deliveries of 14,402. Our Q3 delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct.

In addition to Q3 deliveries, about 5,500 vehicles were in transit to customers at the end of the quarter. These will not be counted as deliveries until Q4.

Production rose to 25,185 vehicles in Q3. This was an increase of 37% from Q2 production of 18,345.

We expect Q4 deliveries and production to be at or slightly above Q3, despite Q4 being a shorter quarter and the challenge of delivering vehicles in winter weather over holidays. Guidance of 50,000 vehicles for the second half of 2016 is maintained.

Finally, we note that starting in Q3, our quarterly financial releases will no longer include non-GAAP revenue and related financial metrics resulting from vehicles leased through our banking partners or that include resale value guarantees. We will, however, continue to provide additional supplemental information to investors to provide insights into our business.

Tesla vehicle deliveries represent only one measure of the company's financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.

Certain statements in this press release, including statements regarding future vehicle deliveries and vehicle production rates, are "forward-looking statements" that are subject to risks and uncertainties. These forward-looking statements are based on management's current expectations. Various important factors could cause actual results to differ materially, including the risks identified in our SEC filings. Tesla disclaims any obligation to update this information.

nguyenvuminh - 10/3/2016 12:40:15 AM

+4 Boost

For those that have been saying they're going out of business, not impressed I'm sure. For those that paid for their car, quite happy I would guess. For Autospies, they should happy with my click.

HenryN - 10/3/2016 1:08:40 AM

+1 Boost

+1 for nguyenvuminh

if Autospies collects a penny per click, they'll get fifty bucks for this post.

TheSteve - 10/3/2016 1:51:34 AM

+6 Boost

re: "...Our Q3 delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct..."

Um, isn't this the way EVERYBODY counts sales?

PUGPROUD - 10/3/2016 7:35:43 AM

0 Boost

Not always. There are a lot of end of quarter and end of year sales shenanigans that goes on in the industry...various manufacturers at various times count sales once car ordered, or once car leaves factory, or once car hits dealer lots, or stuffs dealers lots with inventory they later take back, etc. etc. When bonuses, stock prices and prestige is on the line how sales are counted can be highly variable.

SanJoseDriver - 10/3/2016 2:01:36 AM

0 Boost

It's a significant year-over-year and quarter-over-quarter improvement, I'm content.

Agent00R - 10/3/2016 10:14:50 AM

+3 Boost

I agree.

It's clear that the incentivization and 60d models are helping.

TomM - 10/3/2016 11:39:52 AM

+1 Boost

Sales figures from Tesla are meaningless - the question is did they make a Profit selling them? Tesla has yet to record a real profit - and has already said that they will need to go back to the stock market for more money - ie - issue more shares which will dilute the currently owned ones.

Tesla still operates largely with no competition in its market slots. Their sales model almost REQUIRES this - since they insist they will not discount their cars in the light of coming competition. But you can bet that the other full line manufacturers WILL discount theirs - putting Tesla at a complete disadvantage.

For those who point to the sales figures as supporting Tesla's continuation - they DON't.

TheSteve - 10/3/2016 2:35:02 AM

+2 Boost

According to this Tesla press release (http://ir.tesla.com/releasedetail.cfm?releaseid=978031), they forecasted sales of 28,600 vehicles in Q3 (13 weeks x 2,200 vehicles per week = 28,600). They actually sold 24,500. Tesla has a long-standing record for missing their OWN sales targets (i.e., over-promise and under-deliver). I'd love to see them break that streak.

Although increasing unit sales is a good sign, profit is a *meaningful* ultimate metric for corporate health, and the word on the street is that Tesla is close to running out of cash (again), and will be turning to capital markets (again) to raise more cash so they can keep "doing business", selling their vehicles at a loss.

TheSteve - 10/3/2016 1:52:40 PM

-2 Boost

runbuh: You're missing the forest for the trees. While it's true that production and sales are different, we must also note that:

(1) Tesla makes production forecasts, and they consistently fall short.

(2) Tesla does NOT carry a meaningful inventory. They sell everything they make, and in short order. Therefore, in Tesla's case, production and sales are VERY closely related.

(3) Any variance between production and a sale (i.e., delivery to a customer) is just a matter of timing. Additionally, the first month of a quarter gets the "extra" sales that were in transit at the end of the previous quarter, as well as not closing some sale at the end, which will be counted as sales in the next quarter. In other words -- +1000 cars July and -1000 cars in September due to "in transit" -- is a wash. That's why honest car companies do not just look at the "1000 in transit" at the end of the quarter, in isolation, and claim their sales are higher because of that.

TheSteve - 10/3/2016 6:58:20 PM

0 Boost

Runbuh wrote “…1 - The link you provided has no production quantity forecast, so what production forecast are they not meeting?...”

http://ir.tesla.com/releasedetail.cfm?releaseid=978031
Article: “…Tesla expects output to reach 2,200 vehicles per week in Q3 [2016]…”
13 weeks (1 quarter) x 2,200 vehicles forecasted output = 28,600 vehicles

http://ir.tesla.com/releasedetail.cfm?releaseid=991720
Article: “…Tesla (NASDAQ: TSLA) delivered approximately 24,500 vehicles in Q3 [2016]…”

Go ahead and make your case that (1) Tesla actually met their 3Q2016 forecast of producing 28,600 vehicles, and (2) 14.3% of 3 months’ worth of alleged production are sitting in inventory, or in transit, somewhere, unsold, undelivered, whatever.

Yeah, I know you’re a Tesla fan, so no matter what happens, it’s all good. I just find it hard to assume that 14% of a quarter year’s (forecasted) production actually got made, but has not shown up anywhere as a brag-worthy number. Sit tight for Tesla production numbers to come out, and to see that once again, (1) Tesla can’t make or chooses not to make the number of vehicles they forecasted, and (2) they can’t translate those non-existent (not produced) vehicles into sales, deliveries, whatever.

BTW, I don’t know why you choose to focus on red herrings like the TECHNICAL difference between an auto sale and an auto delivery. A customer fills out an ORDER and puts down a deposit. When the vehicle’s ownership is transferred to the buyer, which happens when they take DELIVERY, the customer becomes the legal owner, and the SALE is considered to be completed. So in the auto industry, delivery to customer = sold car. Mind you, some dealers and manufacturers like to fudge those numbers to boost their unit sales numbers, so they might count a car as “sold” even though the dealer or manufacturer is still the legal owner, and still possess it. Go figure.

TheSteve - 10/4/2016 8:50:17 PM

+1 Boost

runbuh: Ah, I see your perspective! You interpret the statement “…Tesla expects output to reach 2,200 vehicles per week in Q3 [2016]…” to mean they could create just 1 car per week, but as long as they make 2,200 cars in ANY week during that quarter, then they've met their forecast prediction of "2,200 vehicles per week in Q3".

I agree with you, that this is a possible interpretation of that sentence! It's a stretch, but it is a valid interpretation, which I acknowledge.

I also believe that when Tesla's forecasts get compared to their actual production number at the end of the 2016 calendar year, they will once again fall short of their forecasted numbers, as they have consistently done in the past. And we'll see chagrined analysts talking about it. Do you believe otherwise?

nguyenvuminh - 10/3/2016 1:08:52 PM

+2 Boost

I'm sure someone is equating Tesla with Toyota, or maybe not.

MDarringer - 10/3/2016 7:26:08 PM

0 Boost

They both begin with "T"....

MDarringer - 10/3/2016 7:25:42 PM

0 Boost

I wonder how many of them are Tesla "courtesy" vehicles.

valhallakey - 10/4/2016 1:28:30 AM

+1 Boost

Approaching Infinity numbers. They only sell around 10k cars a month,