Category Archives: Sales

The case for Tesla deferring 200K until July

So I have long been arguing that Tesla would cross the 200K US vehicles barrier in 2Q18, despite optimistic estimates that they would cross it in the first quarter.  Some enthusiasts even thought they would cross it in the final few weeks of 2017!  With the latest news from Tesla, I don’t think anyone believes it will occur in the first quarter any more.

With the latest news from Tesla, there are now some people speculating that Tesla may be able to defer hitting 200K until the third quarter (July 1).  Initially I was definitely not in that camp.  In fact in my post two days ago, I specifically thought that Tesla would hit the 200K mark in late April and there was no way they would defer.

However, between new speculation on what it means that some Canadians are getting earlier delivery estimates for AWD models that even those of us in the US, combined with news that a key Ontario EV tax credit is expiring in June, and a fellow forum member who kindly reminded me that there is a lag between an increase in production at the Gigafactory and actual sales, I have revised my thinking and run the numbers.  The results indicate that it is at least plausible that Tesla may try to do this.

Here is what that would mean:

  1. As was the assumption before (prior to the extended production delays) it will be necessary to divert additional Model S and X overseas above and beyond what Tesla would normally do.  I am assuming a 20% figure.  This will be somewhat hard to swallow for US buyers due to the extremely low inventory of Model S/X already, so build times might climb past 8 weeks from order to delivery.
  2. I am assuming that a best case scenario for the new equipment to be installed and running at the Gigafactory is the end of March.  This will allow the battery module production rate to spike to 2,500 per week, but because the cars using those modules still need to be built, sent to a distribution center, prepped and actually delivered, I am assuming a four week lag before we start seeing the sales ramp hit 2,500 per week.  So I effectively moved my step-wise ramp to the right by 4 weeks.
  3. Finally the key aspect of this plan would be to divert a significant number of Model 3s to Canada.  For simplicity I assumed that up to 2,000 per week (subject to actual production rate) would be diverted to Canada, starting in April through the end of the second quarter (June 30).  This adds up to a total of 23,000 vehicles that otherwise would have been destined to the US, and effectively meaning there would be a 10 week pause in US deliveries before significant numbers were seen again.  During the second quarter, only 9,500 deliveries would be made in the US.  Of course Tesla wouldn’t have to follow this exact plan, but the effectively the numbers would have to work out roughly this way.

With those assumptions, I have Tesla selling a total of 200,246 vehicles as of June 30th, so with only a day or two of halted selling, they could defer selling #200,000 until July 1st.

This is what the ramp I’ve described looks like visually:

The drop in Model 3 sales in April and May represents the diversion to Canada.  The increase in late June represents the factory throughput kicking into high gear, not an end to the diversion to Canada.  After the end of the quarter, this rate would further increase to the full 5,000 per week (6,000 across the whole product range).

The cumulative sales look like this:

The slowdown in sales to the US is noticeable, but not tremendously so.  Of course the impact will surely be felt by those with April to June delivery estimates!

I’m certainly not at the point where I’d be willing to say this is how Tesla will play this, but there are certainly some indications that it may go this way.  As usual it will be very interested to see February sales estimates, any indication of the Model 3 ramp, and probably most importantly if and when Canadians start to get more specific delivery estimates and even invites to configure.  Certainly if we don’t see any of that happening by late March, this plan will not be put into play.  But until then, it’s something to think about.



Post-January sales update

So it has been quite awhile since my last update.  Unfortunately I had some personal matters that came up and I was not able to post a year-end summary.

At any rate, 2017 went out with a bang.  Total US sales across all manufacturers totaled 26,107 which broke the record of 24,785 set last December.  I’m sure the threat of losing the EV tax credit didn’t hurt, although buyers who want an “instant return” on their EV tax credit would normally buy in December anyway.  The end of year is also traditionally a time for sales pushes as well.

Of note, the Chevy BoltEV sold 3227 copies, and the Model S and X had great a great month with 4,975 and 3,300 estimated sales respectively.

On the Model 3 ramp, the news could have been better.  Remember that Elon Musk initially predicted 5,000 Model 3s per week by year end.  Well, the reality turned out to be significantly less than that (which I don’t think surprised anyone).

Tesla did try their best to spin the disappointing news with marketing statements (that seemed like they had the desired effect, as many took the bait) such as their manufacturing lines reached a rate that extrapolated to over 1,000 units per week during the last few days of 2017.  The reality is that the actual production during the last week of 2017 was 793 units, not the 1,000 that most people quickly reading the statement assumed.

At the end of the month, however, only 1060 Model 3s were sold, with 860 “in transit”.  Considering there were also probably a few “in transit” at the beginning of the month, we can estimate that there were probably only 1600 or so Model 3s actually produced in December.  If 793 of those were produced in the last 7 days alone (and that was probably an all out push to generate good news), it doesn’t speak so much for the volume during the rest of the month.

Nonetheless, the news is at least positive that they were able to improve the production rate so dramatically.

This puts the total US sales for Tesla at the end of 2017 at about 161,571.

So how did the January numbers turn out?  As is the case every January, the big push at the end of the year, combined with lousy weather that is typical in January and post-Christmas bills, sales were down.  Way down.  Across the board.

Sales of the Chevy BoltEV plummeted to 1,177, just over a third of what they were the month prior.

Tesla Model S and X sales were estimated to be 800 and 700 respectively, slightly below what they were last January.  Model 3 deliveries were estimated to be 1,875.  Better than December for sure, but still nowhere near the milestone of 1,000 per week.  Rumors are that the factory was shut down for the first week in January, partly to give workers some well deserved R&R after the big December push, but also to perform routine maintenance on the assembly line machinery.  But still, even if you assume 3 weeks in January, and assume the same level of vehicles “in transit”, you’re still only talking an average of 625 vehicles per week.  Still a long way to go.

I actually feel that the number of vehicles “in transit” might be higher.  The reason is that Tesla is having to build out its delivery infrastructure as well.  The first Model 3s were delivered to relatively big delivery centers in California.  Now that vehicles are being distributed across the country, not only does the transit time itself increase, but you have to ship cars to many smaller stores and delivery centers that may not have the throughput that the ones in Fremont and LA have.  However, that excuse only works once.  Now that the pipe is full, we should expect to see more consistent deliveries.

So that puts us at around 165,000 vehicles from Tesla with only 8 weeks left in the quarter.  Even if Tesla were able to produce 4,375 vehicles per week today, they wouldn’t hit 200,000 before the end of the quarter.  I think we can safely put to rest any fear that they will hit 200K this quarter.

But do we need to consider the possibility of Tesla delaying all the way until July 1 to cross that barrier?

I don’t think so.  Assuming a ramp that gets them to 2.5K/week at the end of 1Q18 and 5K/week at the end of 2Q18, I predict they will hit #200,000 around April 25.  This is far too early in the quarter to talk about deferring until 3Q.  So I put the likelihood that they will hit it in 2Q extremely high.

As for other manufacturers, I think we really need to see where sales wind up after looking at February and March.  January’s sales were just too depressed to make any meaningful predictions at this time.  In particular, will Bolt sales end up picking up where they left off?  And what about the Nissan LEAF 2.0?  How well will that sell in the US market?

Stay tuned!

October 2017 US EV Sales Update

So we come into November with the news that President Trump’s new tax plan (at least the version put forth by the House) seeks to eliminate the US Federal EV Tax Credit, possibly rendering this entire discussion moot.  The Senate version, on the other hand, retains the tax credit.  We can only hope that either the bill is reconciled favoring the Senate version, or that the whole proposal gets caught in the usual Washington quagmire and simply goes nowhere before the end of the year.  But I digress…

The October sales figures are in and there are a few high (and low)-lights to note.

The Chevy BoltEV set a second consecutive monthly sales record with 2781 Bolts hitting the road in October.  Even with this result, it doesn’t break GM’s record of 4290 EVs sold in December of 2016, thanks in large part to the 3691 Volts sold that month.  But watch this space!

On the other side of the coin was the fact that Nissan only sold 213 LEAFs, it’s lowest month since February of 2011, in only the third month of its being available in the US when 67 copies were sold.  While one may be tempted to say that this is simply due to the fact that everyone is waiting for the 2018 LEAF 2.0 to appear, it’s probably more true that even if you wanted one you probably couldn’t find one.  The outgoing fleet is being sold off and there were fewer than 300 to be had nationwide at the end of October, and fewer than 200 as of this writing.

The Tesla Model 3 was also a disappointment as well.  Production bottlenecks continue to push back the anticipated ramp of Model 3 production.  While actual figures are not known, InsideEVs estimates that only 145 Model 3s were sold in October (although I believe this is poised to change in November–stay tuned).

Back to the highlights side, the Chrysler Pacifica PHEV sold 1175 units this month, establishing October as a record for FCA of 1485 vehicles.


So what do things look like in the final 2 months of the year and heading forward?


I’m still estimating 2400 Model S and 1860-1880 Model X for the remainder of the year.  Based on October’s estimate of 1120 and 850 respectively this may seem optimistic, but it will probably come out in the wash since December will likely be a strong month for Tesla (unless they decide to start diverting even more of those vehicles overseas).  In fact, that is the stated reason for the lack of sales–they are apparently stockpiling vehicles to send abroad in December in hopes of finishing the quarter off strong.  For the Model 3 it is starting to appear that the Gigafactory bottleneck that has been the cause of the slow start is finally starting to ease.  Recent VIN spottings and sightings of car carriers loaded with Model 3s indicate that there may be around 1000 Model 3s on the road as of mid-November.  Given the lag in these reports, this would indicate to me that we are probably going to see in the neighborhood of 1000 Model 3 sales in November, which basically puts us 2 months behind Elon’s initial ramp estimate.  The company themselves indicated that it’s perhaps a 3 month delay.  Either way this will certainly seem like an insignificant blip by next year.  I am going to maintain by estimate of 1000 Model 3s in November and 2000 in December, although this could be pessimistic.

Altogether this brings Tesla to 160,222 by year end.  I think it’s very clear at this point that they will not cross 200,000 anytime soon in 1Q18, and therefore I figure they will position themselves to cross that line in April of next year.

However, based on my assumptions for the ramp and expected Model S and X sales in 1Q18 (2000 per week in January, 2500 climbing to 3500 per week in February and 4000 climbing to 5000 per week in March), and a continuation of Model S and X sales, I estimate that Tesla would cross 200,000 just before March 15.  They will therefore have to take some kind of action to cross the line in 2Q18.  With the assumption that they divert an additional 5% Model S & X overseas (above and beyond what they normally do), and either stockpile 1000 Model 3s a week, or basically stop selling for the final 2.5 weeks of March, effectively creating a stockpile of 12,000 Model 3s ready to go on April 1.  With these actions, I estimate they will be at 199,248 on March 31, right where they want to be.


I have revised my BoltEV assumptions to 3000 per month for November and December.  Uncertainty around the fate of the US federal tax credit, and a typically strong December for the car industry and EVs in particular will likely translate to record sales for the Bolt.  With these assumptions, I have GM leading Tesla at year end with 167,486 US sales.  Furthermore, this puts them on a run rate of around 4500 vehicles per month.

Extrapolating that into next year (with a few tweaks), I estimate that GM will exit 2Q18 at about 192,400 vehicles.  If they want to game the system, they too could delay hitting 200,000 until 4Q18, but at this point it’s probably too soon to tell just how far BoltEV sales will go.  If they continue their upward trend, then GM may find themselves beginning the phaseout period next July, only one quarter behind Tesla.  For now I will consider this the most likely scenario.


I project Nissan will exit 2017 with 115,690 US sales.  The thought is that LEAF 2.0 will revitalize Nissan’s sales figures, although it remains to be seen how the market will accept the slightly shorter range, but significantly cheaper vehicle.  Even if we assume 5,000 vehicles per month, they will easily cruise into 2019 with their tax credit intact (assuming the politicians don’t get in the way).


I estimate Ford to be at 104,731 US sales at the end of the year, which is a surprising figure given their sole BEV, the Ford Focus Electric, has only had lukewarm sales, tallying a total of only 8780 sales between its introduction in 2013 and my 2017 year end estimate.  Most of Ford’s sales come in the form of strong PHEV sales.  But still there is a long way to go and it will be well into 2019 before we can start to seriously look at Ford’s 200,000 aspirations.


Despite a lot of talk and on-again off-again plans, the European automakers–BMW, VW, Daimler–sit at 55,203, 26,510 and 13,176 respectively.  Supposedly 2020 will be the year when we really start to see massive numbers of EVs from those makes, but until then, there is no danger of them getting near 200,000.

Toyota has a respectable 67,326 (estimated) and is showing good strength with their plug-in Prius.  But until they start to get really serious about battery electrics (again, supposedly in 2020), we’re still a few years away from seeing them cross the line.

Fiat-Chrysler is actually estimated to be at 29,155 by year-end, thanks to the success of the Fiat 500e and more recently the Chrysler Pacifica Hybrid.  While obviously a long way off, it will be interesting to see how that minivan does in the market.  It may just turn out to be a winner if they market it.

Hyundai/Kia is estimted at 12,903, but with they are poised to come on strong with their Ioniq lineup.


September 2017 Sales Update

It’s November 1 today and here I am posting a September sales update!

Well the reason is that I want to get the September sales baseline on the record before updating my numbers to reflect October sales (which are not finalized yet).

The purpose of these updates is to track progress towards, and my estimates of, when various manufacturers will cross the 200,000 US vehicle sold mark and start the clock ticking for the phaseout of the US $7500 federal tax credit for EVs.  The phaseout works like this:

Up until a manfuacturer sells its 200,000th car in the US, the buyer of that manufacturer’s car is eligible to receive a $7500 federal tax credit, subject to them having sufficient tax liability.  Once a manufacturer sells it’s 200,000th car, cars sold in that current calendar quarter and the following quarter are still eligible for the full tax credit.  For the following two quarters, the credit is cut in half to $3750, and for the two quarters following that, the credit is again cut in half to $1875.  After those two quarters are up, the tax credit for that manufacturer expires.  Note that each manufacturer has its own timetable unrelated to other manufacturers.  That means that Tesla may lose its credit while Chrysler may continue to get the full credit for several years!  (Note, I am strongly opposed to this structure as I think it motivates manufacturers to sit back and let others do the hard work and burn through their credits).

The following illustrates how this would work:

US Federal Tax Credit Illustration. Example only, not real data.

Under the system, it would be most advantageous to the consumer if the manufacturer sold car #200,000 on the first day of a new quarter.  This would give the manufacturer practically two full quarters of the full tax credit before it starts to phase out (green shading).  If, on the other hand, car #200,000 was sold on the last day of the quarter, the full tax credit would only be available for another 3 months, vs. 6 months if they had waited one extra day.

So, as the third quarter ends, two manufacturers in particular are getting close to hitting car #200,000:  Tesla and GM.  So all eyes are on these two manufacturers and their US sales figures to determine exact when the phaseout clock starts ticking.  Particularly in the case of Tesla, which looks like it will cross that line first.  There are a few people that say that it will cross the line in December 2017 (unlikely if only for the reason that they will likely wait until the beginning of a new quarter before crossing that mark), and I would say that the consensus opinion is that they will cross the line in 1Q18.  A minority (including myself) think it will be 2Q18, meaning the full tax credit should be available until the end of September 2018, and not phase out completely until September 30, 2019.

Now I get most of my data from InsideEVs Monthly Plug-in Sales Scorecard.  It’s not the authoritative source of information, but the official source of information, the IRS IRC 30D – Plug-In Electric Drive Motor Vehicle Credit Quarterly Sales page, which incidentally is periodically updated, strangely includes only data for Ford, BMW and Mercedes, so we really don’t know about all the other manufacturers.  But InsideEVs tracks these numbers very closely based on actual sales reports from the manufacturers, so they are reasonably trustworthy.  Now I will point out that while InsideEVs and I update our numbers monthly as automakers release their monthly sales figures, Tesla only reports sales quarterly, so for the non-quarter-ending months, it’s a little bit of a guessing game, but InsideEVs does have a good track record and does go back and adjust the numbers to fit the reported data at the end of the quarter.

So without further ado, I present my figures as of September 2017:

US EV Sales summary as of Sep ’17

This shows that through the end of 2016, Tesla had sold 111,949 vehicles in the US.  Through September, they had sold 35,140, bringing the total sold to date (not shown) to 147.089.  I am projecting that by year-end 2017, they will have sold 62,717, bringing their total by year-end 2017 to 174,666, well short of 200,000.  And even though Elon Musk has “promised” us 5,000 Model 3’s per week by the end of December, that still puts us well into 1Q18 before they hit #200,000, which is why I think they will delay selling #200,000 until April 2018.  After all, Elon Musk tweeted that Tesla would do the right thing to maximize the number of people that got the credit, even if it meant taking a hit on quarterly sales.  This means to me that Tesla would divert Model S and X sales outside the US, and stockpile Model 3’s until the beginning of the new quarter.  Not only would this allow them to immediately sell a larger number of Model 3’s at the full credit amount, but it would extend the full tax credit to the timeframe when the dual-motor version of the Model 3 will be available (which will make a LOT of Model 3 reservation holders very happy).  It will also shorten the time period that the Model 3’s nearest competitor (the Chevy BoltEV) would have a tax credit advantage over the Model 3 to one quarter (possibly even zero).  And since those who hold Model 3 reservations are already given a three month delivery window, they could easily shift deliveries up to nearly a quarter without anyone being the wiser.

I will get into more stats and details in coming months, but as one closing comment for this post, let me describe my assumptions for Tesla and GM sales going forward.

For Tesla, I am assuming Model S growth of 15%, or between 2500 and 2600 sales per month (this tracks a 15.83% actual growth rate), and also 15% growth for Model X (although its growth rate has been larger), assuming between 1950 and 2000 sales per month.  For Model 3, it’s a bit trickier.  Elon Musk said 30 in July, 100 in August, 1500 in September, and climbing to 5000 a week by the end of December.  By now we know that they missed the mark by quite a bit in September, and we’re not really sure when they will recover, or even if it’s just a delay in the ramp up, or something they will make back up.  What we do know is that the numbers were more like 75 in August and only 115 in September.  I have revised my estimates for October-December to be 2000 in October, 4000 in November, and 8000 in December, but I feel those are very optimistic best-case scenario type numbers.  But for purposes of this kind of analysis, we do want to think conservatively (in hindsight, I DEFINITELY know those are optimistic)!

For GM I am assuming moderate 6% growth for the Volt (3% actual) and a flat 2500 units per month for the BoltEV.

That’s it for the time being.  I’ll be back shortly with the update for October!