As of this weekend with only just over a day left in the quarter, Tesla still had over 3,000 Model 3 vehicles left in inventory in the US, according to a source familiar with the matter.
Over the past months, Tesla has been trying to put everything in place to be able to deliver a record number of vehicles in the US in order to help people take advantage of the federal tax credit before it starts to phase out for Tesla buyers in 2019.
The start of the phase-out was expected to create a surge of demand for Tesla vehicles in the US.
The automaker aimed to liquidate every car in the US, but a source familiar with Tesla’s retail operations says that the company still managed to build some inventory.
According to a source familiar with the matter, Tesla had over 3,300 Model 3 vehicles in inventory in the US on Sunday.
Over the past few weeks, Tesla and Elon Musk have been consistently promoting the fact that they can deliver vehicles in the US by the end of the year.
Musk was tweeting again on Saturday:
Reminder to US buyers that the $7500 tax credit drops in half in about 48 hours. Order online at https://t.co/46TXqRrsdr or visit a Tesla store to see if there is any inventory left in your region.
— Elon Musk (@elonmusk) December 30, 2018
Tesla is expected to deliver some of those vehicles today, on the last day of the year, but sources familiar with the matter don’t think it’s possible for the automaker to go through the whole inventory.
Last week, Tesla even turned to employees to buy some of those vehicles.
When put into perspective, it’s really not that bad since it’s just about half a week of Model 3 production for Tesla.
That said, there was this impression that demand would significantly outpace production in the US this quarter due to the start of the tax credit phase-out.
It looks like it wasn’t entirely the case.
Tesla might be seeing peak demand for the current Model 3 configurations in the US.
To be clear, I’m not worried about demand for the Model 3. With European and Asian markets still untapped, Tesla is going to be able to sell many more of those Model 3’s.
But in the US, I think most potential buyers are now waiting for the cheaper version of the Model 3.
Even with the $3,750 difference in the tax credit, the Mid-Range Model 3 is still about $5,000 more expensive than what many reservation holders expected to pay for the vehicle.
I think Tesla tried to time its European expansion with the start of the tax credit phase-out in order to have as little inventory as possible in the US – knowing that demand is going to crash in the US after the phase-out.
Now in January, the Model 3 production is going to go to Europe, but it looks like Tesla is going to be stuck with a few thousands Model 3’s in the US.