Following a surge in production in the last days of the month which as Reuters reported saw the company produce its 5,000th unit a few hours after the midnight deadline, on Monday Tesla published its Q2 production and delivery update, and confirmed that “In the last seven days of Q2, Tesla produced 5,031 Model 3 and 1,913 Model S and X vehicles.”
According to the release, in Q2 production totaled 53,339 vehicles, “a 55% increase from Q1, making it the most productive quarter in Tesla history by far.” Tesla also claims that the first time, Model 3 production (28,578) exceeded combined Model S and X production (24,761), and it produced almost three times the amount of Model 3s than it did in Q1.
Commenting on the controversial “tent”, Musk said that “GA4, our new General Assembly line for Model 3, was responsible for roughly 20% of Model 3s produced last week, with quality from that line being as good as our regular GA3 line. We expect that GA3 alone can reach a production rate of 5,000 Model 3s per week soon, but GA4 helped to get us there faster and will also help to exceed that rate.”
In total, Q2 deliveries totaled 40,740 vehicles, of which 18,440 were Model 3, 10,930 were Model S, and 11,370 were Model X.
Looking ahead, an optimistic Tesla expects to increase production to 6,000 Model 3s per week by late next month.
This won’t be the first time the company has been overly aggressively on the future, and it was exactly one year ago that Elon Musk predicted he can reach 20,000 Model 3 cars per month in December.
Looks like we can reach 20,000 Model 3 cars per month in Dec
— Elon Musk (@elonmusk) July 3, 2017
There was also no mention of the “factory gating” definition used by Musk in his public statements over the weekend, prompting many to wonder what is the difference between produced and “gated” units. We look forward to finding out.
On the delivery side, Tesla reported Q2 deliveries totaled 40,740 vehicles, of which 18,440 were Model 3, 10,930 were Model S, and 11,370 were Model X adding that “Model S and X deliveries are in line with our guidance provided on May 3.”
Additionally, Tesla also reaffirmed its guidance for positive GAAP net income and cash flow in Q3 and Q4, “despite negative pressures from a weaker USD and likely higher tariffs for vehicles imported into China as well as components procured from China.”
Some other comments from the release:
As we previously noted, we are in the process of changing the quarterly production pattern of those vehicles for the various worldwide regions to ensure a more linear flow of deliveries through the quarter. Both orders and deliveries for Model S and X were higher in Q2 than a year ago. Our overall target for 100,000 Model S and Model X deliveries in 2018 is unchanged.
The press release ends on an oddly emotional note:
The last 12 months were some of the most difficult in Tesla’s history, and we are incredibly proud of the whole Tesla team for achieving the 5,000 unit Model 3 production rate. It was not easy, but it was definitely worth it.
And to underscore that, the release carried this photo of the “Tesla team celebrates production milestone.”
With many traders having shorted into today’s release, the outcome was predictable: yet another TSLA short squeeze.
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