Originally Posted to Twitter on 2/28/19 by @Tesla_Bear
So, Elon Musk keeps promising he will produce 5,000 Model 3s a week. Or even 7,000.
But most of the media forgets to ask THE most important question: Is there enough demand for 5,000 per week?
The clear answer is: No.
Model 3 orders are currently imploding.
Proof? Read on.
So, Elon Musk keeps promising he will produce 5,000 Model 3s a week. Or even 7,000.
But most of the media forgets to ask THE most important question: Is there enough demand for 5,000 per week?
The clear answer is: No.
Model 3 orders are currently imploding.
Proof? Read on.
Model 3 demand in Europe is disastrous. (will cover US later, stay tuned).
Remember, Europe is THE story Tesla is trying to sell right now: They claim that US deliveries are slow ONLY because they have to ship all those cars to Europe.
I will start with my main conclusion: The “amazing" demand for Model 3 was just an illusion, created by a simple trick: Collect reservations for two YEARS. Then fulfill that backlog in a few MONTHS. Now the backlog is gone, and the poor rate of NEW Model 3 orders is revealed
So, how big is the order backlog for Model 3 in Europe, and how many NEW orders are coming in right now?
There is a great tool to assess demand in Europe: The Model 3 order spreadsheet. It's an online sheet where some Tesla customers are entering their invoice numbers.
These invoice numbers seem to be consecutive in each country: First invoice gets number 1, second gets 2, etc. This means, that just ONE recent entry in the tracker is sufficient: If one customer received invoice number 1,500 on day x, there were 1500 orders up to that day.
The results that we get from the European order tracker are:
A) Disastrous at first glance.
B) Even more disastrous at closer look.
A) FIRST GLANCE:
The tracker is run by German Tesla fans. They link to a charting tool that delivers this chart, made from their raw data:
Remember, Europe is THE story Tesla is trying to sell right now: They claim that US deliveries are slow ONLY because they have to ship all those cars to Europe.
I will start with my main conclusion: The “amazing" demand for Model 3 was just an illusion, created by a simple trick: Collect reservations for two YEARS. Then fulfill that backlog in a few MONTHS. Now the backlog is gone, and the poor rate of NEW Model 3 orders is revealed
So, how big is the order backlog for Model 3 in Europe, and how many NEW orders are coming in right now?
There is a great tool to assess demand in Europe: The Model 3 order spreadsheet. It's an online sheet where some Tesla customers are entering their invoice numbers.
These invoice numbers seem to be consecutive in each country: First invoice gets number 1, second gets 2, etc. This means, that just ONE recent entry in the tracker is sufficient: If one customer received invoice number 1,500 on day x, there were 1500 orders up to that day.
The results that we get from the European order tracker are:
A) Disastrous at first glance.
B) Even more disastrous at closer look.
A) FIRST GLANCE:
The tracker is run by German Tesla fans. They link to a charting tool that delivers this chart, made from their raw data:
This chart already shows two things:
December: line is almost vertical. February: almost horizontal.
This exact pattern would emerge when orders mostly come from depleting a backlog, not from getting many NEW customers each week
B) THE DISASTROUS CLOSER LOOK
At the beginning of February, Kaju (supervisor of the tracker) discovered that Tesla customers in Germany started to receive TWO (or even more) invoices, each with a new invoice number. Therefore, the tracker was no longer reliable. Each double invoice sent to a customer inflated the numbers of ALL invoices issued afterwards. Kaju decided to cut off the counter.
So this was the last reliable number (cut-off date varies per country, see table):
Only 18,000 orders.
- At the beginning of February, there seemed to be ONLY ~18,000 Model 3 orders in Europe. That is only FOUR weeks of Model 3 production (if you believe Tesla's official production numbers).Now, you have to keep in mind that Tesla was urging everyone in Europe to order really fast. To get your Model 3 in march, you presumably had to order in 2018.So it is highly likely that most Europeans who want a current Model 3 version have already ordered in December.
- The graph also indicates that Model 3 orders have been slowing down massively.
December: line is almost vertical. February: almost horizontal.
This exact pattern would emerge when orders mostly come from depleting a backlog, not from getting many NEW customers each week
B) THE DISASTROUS CLOSER LOOK
At the beginning of February, Kaju (supervisor of the tracker) discovered that Tesla customers in Germany started to receive TWO (or even more) invoices, each with a new invoice number. Therefore, the tracker was no longer reliable. Each double invoice sent to a customer inflated the numbers of ALL invoices issued afterwards. Kaju decided to cut off the counter.
So this was the last reliable number (cut-off date varies per country, see table):
Only 18,000 orders.
Tesla fans would argue that since the cut off, there have been additional orders.I will argue that these 18,000 orders were already inflated by double invoicing.
That means: Even today, we might still be BELOW this disastrous number of 18,000 Model 3 orders for Europe.Support for this theory comes from the raw data.
(Thanks to the skills of @TeslaCharts, neatly presented here).
Take Germany, for example. The tracker (falsely) indicates that on Feb 11, there were 4218 Model 3 orders: The blue dot in the upper right corner.
BUT:
That means: Even today, we might still be BELOW this disastrous number of 18,000 Model 3 orders for Europe.Support for this theory comes from the raw data.
(Thanks to the skills of @TeslaCharts, neatly presented here).
Take Germany, for example. The tracker (falsely) indicates that on Feb 11, there were 4218 Model 3 orders: The blue dot in the upper right corner.
BUT:
Look at the horizontal red line. Any invoice number above it is probably inflated by double counting.
Why? The red line indicates invoice number 3437, and according to the Model 3 tracker, that invoice was the SECOND invoice that one customer received.
In the tracker...there is now a second row for invoice numbers, so that customers can enter the number of first invoice and final invoice separately). Number 3437 was entered by a customer who had already received invoice number 176 earlier. And 3437 is only one of MANY double invoices.
In fact, reports in the German Tesla Forum seem to indicate that every Model 3 customer in Germany ultimately receives at least two invoices (some even receive three or four...). So, in the end, the number shown by the order tracker would be at least 2 times higher than the actual number of Model 3 sales.
So how many Model 3 has Tesla sold in Germany so far? Look at the trend of Model 3 sales, below the red line (so before double invoices were issued): Obviously, new sales already slowed down dramatically in January. Now, extrapolate the trend of that curve: It seems likely that Tesla still has less than 4,000 Model 3 orders in Germany.
And Tesla might have started double invoices even earlier. The red line is simply the first double invoice that we know of in Germany (more followed soon afterwards).
All this means that the (disastrous) European sales estimate of ~18,000 might even be too high, as of now.
Finally, a quick view at other countries (by order of importance for Tesla's sales). The trends here are less reliable because fewer customers reported their numbers.
Norway (most important market) shows the same trend: Half of all sales already happened at the beginning of December. After that, much slower sales. According to the tracker, invoice 3901 was already a double invoice (issued to customer who received invoice 2189 earlier).
Why? The red line indicates invoice number 3437, and according to the Model 3 tracker, that invoice was the SECOND invoice that one customer received.
In the tracker...there is now a second row for invoice numbers, so that customers can enter the number of first invoice and final invoice separately). Number 3437 was entered by a customer who had already received invoice number 176 earlier. And 3437 is only one of MANY double invoices.
In fact, reports in the German Tesla Forum seem to indicate that every Model 3 customer in Germany ultimately receives at least two invoices (some even receive three or four...). So, in the end, the number shown by the order tracker would be at least 2 times higher than the actual number of Model 3 sales.
So how many Model 3 has Tesla sold in Germany so far? Look at the trend of Model 3 sales, below the red line (so before double invoices were issued): Obviously, new sales already slowed down dramatically in January. Now, extrapolate the trend of that curve: It seems likely that Tesla still has less than 4,000 Model 3 orders in Germany.
And Tesla might have started double invoices even earlier. The red line is simply the first double invoice that we know of in Germany (more followed soon afterwards).
All this means that the (disastrous) European sales estimate of ~18,000 might even be too high, as of now.
Finally, a quick view at other countries (by order of importance for Tesla's sales). The trends here are less reliable because fewer customers reported their numbers.
Norway (most important market) shows the same trend: Half of all sales already happened at the beginning of December. After that, much slower sales. According to the tracker, invoice 3901 was already a double invoice (issued to customer who received invoice 2189 earlier).
Unfortunately, much less data points here, so that entry could be wrong. Link to raw data.
Note: Some obvious inconsistencies are probably due to credit card payment vs wire payment (wire payment customers prob. receive invoice number later).
Finally, the data for France, Switzerland and the Netherlands. Again, less data points than Germany, so less reliable. Switzerland seems to have "reset" the invoice numbers (once they sent out the final invoices). So no double counting here. But note: This could even indicate that Tesla already sent some final invoices mid-January. So it might be possible that in countries WITH double invoices, the artificial inflation of numbers already started in January.
NL: Number of one double invoice VERY low (I excluded it, in Tesla's favor).
Note: Some obvious inconsistencies are probably due to credit card payment vs wire payment (wire payment customers prob. receive invoice number later).
Finally, the data for France, Switzerland and the Netherlands. Again, less data points than Germany, so less reliable. Switzerland seems to have "reset" the invoice numbers (once they sent out the final invoices). So no double counting here. But note: This could even indicate that Tesla already sent some final invoices mid-January. So it might be possible that in countries WITH double invoices, the artificial inflation of numbers already started in January.
NL: Number of one double invoice VERY low (I excluded it, in Tesla's favor).
CONCLUSIONS
IMHO these 3 points are clearly corroborated by the data.
So where will Tesla sell these 5,000 Model 3 per week?
Musk has already lost it in Europe. Same for US. Will put up a thread soon. Strong indications for the same story: Backlog gone, almost no new orders.
I think it's "game over" for Elon Musk.
Doesn't matter what he will tweet tonight: Even fresh billions wouldn't help.
Finally: Why did ANYONE believe that Musk would sell thousands of Model 3 each week? Look at sales numbers of other electric cars: The most popular sell 100 to 500 per week in the US. Why would Model 3 (expensive and much less reliable) sell 10x more?
****************
Note: Within hours of @Tesla_Bear making the post copied above, Tesla announced that they were dropping the price on the Model 3 and closing their bricks-and-mortar retail stores. Further bolstering the contention that Tesla is both running out of money and facing a glut of unsold inventory. --Robert Perez
- The tracker strongly indicates that Model 3 sales in Europe are a disaster. The sales numbers are MUCH worse than what Elon Musk promised.
- Just a FEW weeks of production would be sufficient to fulfill ALL orders that Tesla currently has in Europe.
- And even these low order numbers are the result of harvesting reservations during two years. NEW orders at the moment? Almost nonexistent.
IMHO these 3 points are clearly corroborated by the data.
So where will Tesla sell these 5,000 Model 3 per week?
Musk has already lost it in Europe. Same for US. Will put up a thread soon. Strong indications for the same story: Backlog gone, almost no new orders.
I think it's "game over" for Elon Musk.
Doesn't matter what he will tweet tonight: Even fresh billions wouldn't help.
Finally: Why did ANYONE believe that Musk would sell thousands of Model 3 each week? Look at sales numbers of other electric cars: The most popular sell 100 to 500 per week in the US. Why would Model 3 (expensive and much less reliable) sell 10x more?
****************
Note: Within hours of @Tesla_Bear making the post copied above, Tesla announced that they were dropping the price on the Model 3 and closing their bricks-and-mortar retail stores. Further bolstering the contention that Tesla is both running out of money and facing a glut of unsold inventory. --Robert Perez
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