It seems we didn't have to wait too long for Elon Musk's reaction after the note written by top Wall Street analyst Rajvindra Gill from Needham claiming that Tesla is getting more Model 3 cancellations than new orders.
Although it might be a rather unusually transparent move, Musk has revealed Tesla's new order breakdown from last week to defeat the claims that demand for the Model 3 is flattening.
According to Musk, Tesla received over 7,000 new orders--over 2,000 for Model S and Model X, and 5,000 for Model 3.
Gill noted that refunds are outpacing deposits as cancellations accelerate because of extended wait times, the expiration of the $7,500 credit, and unavailability of the $35k base model.
"In August '17, TSLA cited a refund rate of 12%. Almost a year later, we believe it has doubled and outpaced deposits. Model 3 wait times are currently 4-12 months and with base model not available until mid-2019, consumers could wait until 2020," Gill added.
Tesla immediately reacted to Gill's note on Thursday saying that the notion that Model 3 cancellations are outpacing orders is unequivocally wrong, Musk obviously wanted to make it more clear, confirming last week's new order rate on Twitter: "Dunno where this bs is coming from. Who knows about the future, but last week we had over 2000 S/X and 5000 Model 3 *new* net orders."
Musk's move is pretty unusual because the company generally releases delivery and production numbers only at the end of each quarter.
Orders for Model 3 last week came several weeks after Tesla invited all reservation holders in the United States and Canada to order the electric sedan that is necessary for his survival. Tesla is banking on Model 3 production ramp-up and sales to turn in its first ever profit, while may analysts continue to doubt that the EV maker can become profitable as it burns a lot of cash in the process.
By Damir Kaletovic for Oilprice.com
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