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Tesla deliveries miss forecast on production delays; shares fall
[SAN FRANCISCO] Tesla Motors Inc reported deliveries that fell short of its forecasts, sending shares lower in after-market trading, as production delays continue to plague the carmaker led by chief executive officer Elon Musk.
The Palo Alto, California-based maker of electric cars and energy-storage products delivered about 22,200 vehicles in the fourth quarter, according to a statement Tuesday. The total trails the 25,000 units projected for the period and brought the company's full-year total to 76,230 vehicles, below guidance for at least 80,000 units.
Tesla has been counting on keeping sales of Model S sedans and Model X sport utility vehicles strong while consumers await the smaller, less-expensive Model 3, which isn't slated to begin production in volume until late 2017.
Mr Musk urged workers in August to cut costs and deliver every car possible, which helped toward Tesla reporting a profit for the three months ending in September, its first in eight quarters.
"They flipped every switch to get every vehicle delivered in the third quarter," Kevin Tynan, an auto analyst with Bloomberg Intelligence, said by phone. "The fourth quarter is the payback. It feels like the Model 3 can't get here fast enough because demand for the Model S is softening as it gets deeper into its life cycle."
Short-term production issues related to transitioning to new hardware for the Autopilot driver-assistance system contributed to transport delays or prolonged physical delivery of about 2,750 cars to customers, according to Tesla's statement. The Autopilot-related challenges began in late October and lasted through early December, the company said.
Over the holiday weekend, Tesla said customers who order a vehicle before Jan 15, 2017, will continue to receive free Supercharging for long-distance travel. After that, customers will get about 1,000 miles of free Supercharging credits, then face nominal fees, which will vary regionally based on the cost of electricity.
The fourth-quarter deliveries figure is a preliminary number that may change slightly in February when the company reports earnings for the period. The automaker releases global sales figures quarterly, instead of the monthly country-by-country results typically announced by other automakers. The delivery count only includes a car if it's transferred to the customer and all paperwork is correct.
Tesla produces cars at its Fremont, California, factory and has said it will make 500,000 cars a year by 2018, an ambitious goal that also depends on the company's battery factory east of Reno, Nevada, coming online with battery-cell production. Tesla is giving investors a tour of its Gigafactory on Wednesday morning.