It looks like Tesla is currently entering its usual end-of-quarter/end-of-year delivery rush and everything points to the automaker achieving a gangbusters quarter for deliveries due to several reasons and two specific markets.
Of course Tesla’s overall sales this quarter are going to get some help from the Model 3, since it should be the first significant quarter for deliveries of the new electric car.
The Model 3’s very first quarter for deliveries was the third quarter, but Tesla ended up only delivering just over 200 units.
Despite the vehicle still having important production issues throughout most of the fourth quarter, we expect deliveries to be significantly higher. According to our estimate, it should be closer to 1,000 units and even higher if they end up fixing the production issues.
We reported earlier today that hundreds of Tesla Model 3 vehicles were recently spotted at delivery centers.
But Model S and Model X will still represent the bulk of the deliveries and we think the vehicles are primed for a record quarter.
There are a few interesting reasons why Tesla is likely going to see record demand for the two vehicles this quarter. The only thing that could slow them down is the production rate, which has been slightly reduced due to staffing, said CEO Elon Musk during the last earnings, but that could potentially be compensated by more inventory vehicles and fewer vehicles in transit by year’s end.
First off, Tesla announced that the opportunity to get unlimited free Supercharging via the referral program for Model S and Model X ends this year.
That’s an attractive feature for a lot of buyers and if it’s truly the last opportunity to get access to it, it might be enough to convince a few people to pull the trigger.
While I think that it will contribute to Tesla achieving a record quarter, I don’t think that it will be the main factor.
The US and Norway, two of Tesla’s three biggest markets (the other one being China), are primed to have a surge of demand that will push Tesla to a record quarter.
After the fear of a special ‘Tesla Tax’ in Norway last month, the automaker finally dodged the bullet in that market and now it’s on pace to achieve another record quarter for deliveries.
In September, Tesla ended up delivering over a new record of 2,000 cars in Norway alone and helped the country achieve a new record for lowest average CO2 emission for new vehicles.
The record month led to a record quarter of 2,359 vehicles delivered, but Tesla seems well-positioned to beat the record by finishing the year strong.
Based on registration data, they are already at 2,085 vehicles and they still have a few weeks left. The last few weeks of the quarter (or year) are generally the best weeks for deliveries and it looks like this year will not be an exception based on the picture of another huge shipment of Tesla vehicles (estimated at ~700 units) seen at the port of Drammen last night (via Bent Knekten Marthinsen):
Even if only half of those vehicles are delivered by the end of the month, Tesla should be able to beat its record.
And then there’s the US.
The fourth quarter is always strong for Tesla in the US because buyers want to get delivery by the end of the year in order to take advantage of the federal tax credit during the current year.
The impact of the tax credit is likely to be even greater this year because of the current talks to remove the incentive, which is likely to push people to take a decision quicker. Then even if the tax credit stays in place by the end of the year, the arrival of the Model 3 will push Tesla faster to the phase-out period, which could also incentivize Model S and Model X buyers to take advantage of the incentive.
In conclusion, Tesla is almost guaranteed to have a record quarter for overall deliveries thanks to Model 3, but everything points to also a record quarter for Model S and Model X deliveries as well if Tesla plays its cards right.
What do you think? Let us know in the comment section below.