There Have Been 63,000 Cancellations Of Tesla’s Model 3 Pre-Orders

Expecting an average of 1,800 new orders a day, Tesla is continuing to see demand for its first mass market car, the Model 3.

However, the company also revealed that about 63,000 people have cancelled their Model 3 pre-orders, Tesla’s CEO Elon Musk said on its quarterly earnings calls. Musk said that on the overall, from about 518,000, the number of  orders went down to about 455,000.

“Those cancellations occurred over the course of more than a year,” Musk said on the call. “I think [these numbers] are inconsequential. With a small amount of effort we can easily drive the Model 3 reservation number to something much higher but there’s no point. It’s like if you’re a restaurant and you’re serving hamburgers and there’s like an hour and a half wait for hamburgers do you really want to encourage more people to order more hamburgers?”

Despite the assurance, it would not be until the end of 2018 at the earliest that those ordering Model 3s today will likely receive their cars.

Still expecting to manufacture 5,000 Model 3 cars a week by the end of 2017, Musk didn’t change its guidance on the production ramp of its mainstream vehicle.

By sometime in 2018, a production rate of 10,000 cars a week would undoubtedly be reached by the company, Musk said.

While stating that he’s never felt better about the company, Musk also did not forget to reiterate the difficulty of the next few months.

“When I said ‘manufacturing hell,’ I meant it,” he said on the call. “We know this, we signed up for it. Not blaming hell because we bought the ticket.”

“This is maybe the best I’ve ever felt about Tesla to be frank,” he continued.

The mistakes made with Model S and X production has taught a great deal to the company, Musk said. for example, on the technology included in the first generation of its SUV the Model X, he had overreached, Musk said.

“We are very confident about costs [of Model 3 production],” he said.

“When we make mistakes it’s because we’re stupid not because we’re trying to mislead anyone,” Musk continued. “We aspire to be less dumb over time.”

More information about the compact SUV the company expects to produce was also given by the CEO who splits his time between Tesla, SpaceX, and now The Boring Company. Originally planned to be built on an entirely new manufacturing platform was the car which was tentatively called Model Y. But Musk said there “will be significant carry over” from Model 3 production in order to bring the compact SUV to market faster.

(Adapted from CNBC)

Categories: Economy & Finance, Strategy, Sustainability, Uncategorized

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