After hyping the Street with its Semi and Roadster reveals, Tesla Inc TSLA closed the quarter with another disappointing miss in Model 3 deliveries.
The firm reported Wednesday to have delivered just 1,550 Model 3 units — below consensus estimates of 5,200.
Model 3 Delivery Expectations
The miss wasn't entirely unexpected. Cowen & Co. seemed to have anticipated it by cutting estimates 75 percent to 2,250, and KeyBanc sliced its forecasts from 15,000 to 5,000.
Even Tesla permabull Gene Munster warned investors to brace for a miss and “further reassurance that bottlenecks are being addressed.” Munster, managing partner at Loup Ventures, had predicted 2,500 units and called the 5,000-vehicles-per-week target “ambitious.”
Production Progress
Tesla notably reaffirmed its 5,000-vehicle production goal to be achieved by the end of the second quarter.
“As we continue to focus on quality and efficiency rather than simply pushing for the highest possible volume in the shortest period of time, we expect to have a slightly more gradual ramp through Q1, likely ending the quarter at a weekly rate of about 2,500 Model 3 vehicles,” the press release said.
The rate supports Munster’s earlier assertion that Tesla would ramp production from 2,500 to 150,000 in 2018.
“We continue to stress that Model 3 production over the next several quarters will be largely a guessing game and that short-term production numbers do not materially affect the long-term story,” Munster wrote in a note.
Overall Performance
That long-term story includes continued improvements in Model S and Model X deliveries, which saw a combined 9-percent sequential increase and 27-percent year-over-year increase representing an all-time best quarter. The older units saw respective deliveries of 15,200 and 13,120 contributing to a total of 29,870.
“As we previously indicated, we slightly reduced Model S and X production in Q4 because of the reallocation of some of the manufacturing workforce towards Model 3 production, which also caused inventory to decline,” Tesla’s press release read.
The stock fell 1.7 percent on the news and, at time of publication, was trading post-market at $317.25.
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