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Tesla Falls Late On Shortages, Sales; Model 3 Reservations Pass 276,000

Loading the player…   Tesla Motors ( TSLA ) stock fell more than 2% after the close in the stock market today , as the company gave a Q1 deliveries count and mentioned Model X parts shortages. That highlights Tesla’s  task ahead as the electric car maker tries to ramp up production dramatically to deliver its new Model 3 starting in late 2017. “Tesla Q1 deliveries consisted of 12,420 Model S vehicles and 2,400 Model X vehicles,” Tesla spokeswoman Alexis Georgeson  said in an emailed statement after the market close. “Q1 deliveries were almost 50% more than Q1 last year and Tesla remains on track to deliver 80,000 to 90,000 new vehicles in 2016.” Tesla said the Q1 delivery count was impacted by “severe Model X supplier parts shortages in January and February that lasted much longer than initially expected.” Production rates improved once the issues were solved, the company said. “The root causes of the parts shortages were: Tesla’s hubris in adding far too much new technology to the Model X in version 1, insufficient supplier capability validation, and Tesla not having broad enough internal capability to manufacture the parts in-house,” Georgeson’s email said. “The parts in question were only half a dozen out of more than 8,000 unique parts, nonetheless missing even one part means a car cannot be delivered. Tesla is addressing all three root causes to ensure that these mistakes are not repeated with the Model 3 launch.” Model 3 Reservations Rack Up, With Challenge Ahead Tesla stock closed up 4% Monday at 246.99, compounding Friday’s gain as reservations for its new Model 3 electric car soared far beyond views. CEO Elon Musk tallied 276,000 reservations by the beginning of Sunday and said he’d give another update Wednesday. The pre-order period opened Thursday ahead of a Thursday-night reveal event. Musk said in Twitter posts that  he’s definitely going to have to rethink production planning. Tesla had expected only one quarter to one half of the 115,000 reservations that came in before anyone even got to see what the car looked like. The refundable reservations are $1,000 each and worth $11.6 billion dollars in revenue if everybody were to go through with a purchase. “While there was clearly a lot of excitement and optimism around both the car and the company, roughly one-third of the respondents we talked to sounded undecided on whether they would actually purchase when the option came up in two years,” Pacific Crest Securities analyst Brad Erickson said in a research note written Friday and distributed late Sunday. The focus now is on how all the numbers — and Tesla stock — will play out. The company has just effectively crowdfunded more than a quarter billion dollars from reservations. That’s more than it raised in its IPO. The 276,000 reservations worldwide also tops the number of electric and plug-in hybrid vehicles sold around the U.S. in the last two years by the entire auto industry. And it’s more than the 245,000 BMW passenger cars sold in the U.S. last year. Tesla delivered almost 51,000 electric vehicles — its Model S sedan and Model X crossover — last year worldwide. Tesla Stock Analysis Going into Monday, Tesla stock was just below where it started 2016. It closed Friday at 237.59 after hitting its highest point since early October. The stock isn’t highly rated by IBD now, factoring in its history of losses and earnings, stock performance and other factors. The Model 3 is the electric car meant for the entry-level luxury mass market, priced at $35,000 for the base model before any tax credits. Musk expects the average purchase price with add-ons to be $42,000. The car is seen as a challenger to BMW’s 3 Series and similarly priced models from Daimler ’s ( DDAIF ) Mercedes-Benz, Volkswagen ’s ( VLKAY ) Audi and Toyota ’s ( TM ) Lexus, as well as electrics like General Motors ’ ( GM ) Chevrolet Bolt EV. Among the many things analysts and investors will be deconstructing is how much content from Tesla’s tech partners Nvidia ( NVDA ) and Mobileye ( MBLY ) go into the Model 3. Nvidia chips power the entertainment console in Tesla’s current vehicles. Mobileye is a maker of camera-based advanced driver assistance systems, and its technology is used by Tesla in conjunction with Autopilot self-driving car features. Mobileye stock rose 3.2% Monday, while Nvidia was down fractionally. Nvidia  gets a top 99 Composite Rating from IBD and Mobileye a 70. RELATED: Tesla Model 3 Reservations Hit 276,000 By Sunday

Tesla Stock Gains Monday As Model 3 Reservations Pass 276,000

Loading the player…   Tesla Motors ( TSLA ) stock climbed 4% in premarket trading Monday, compounding Friday’s gain as reservations for its new Model 3 electric car soared far beyond views. CEO Elon Musk tallied 276,000 reservations by the beginning of Sunday and said he’d give another update Wednesday. The pre-order period opened Thursday ahead of a Thursday-night reveal event. Musk said in Twitter posts that  he’s definitely going to have to rethink production planning. Tesla had expected only one quarter to one half of the 115,000 reservations that came in before anyone even got to see what the car looked like. The refundable reservations are $1,000 each and worth $11.6 billion dollars in revenue if everybody were to go through with a purchase. “While there was clearly a lot of excitement and optimism around both the car and the company, roughly one-third of the respondents we talked to sounded undecided on whether they would actually purchase when the option came up in two years,” Pacific Crest Securities analyst Brad Erickson said in a research note written Friday and distributed late Sunday. The focus now is on how all the numbers — and Tesla stock — will play out. The company has just effectively crowdfunded more than a quarter billion dollars from reservations. That’s more than it raised in its IPO. The 276,000 reservations worldwide also tops the number of electric and plug-in hybrid vehicles sold around the U.S. in the last two years by the entire auto industry. And it’s more than the 245,000 BMW passenger cars sold in the U.S. last year. Tesla delivered almost 51,000 electric vehicles — its Model S sedan and Model X crossover — last year worldwide. Tesla Stock Analysis Going into Monday, Tesla stock was just below where it started 2016. It closed Friday at 237.59 after hitting its highest point since early October. The stock isn’t highly rated by IBD now, factoring in its history of losses and earnings, stock performance and other factors. The Model 3 is the electric car meant for the entry-level luxury mass market, priced at $35,000 for the base model before any tax credits. Musk expects the average purchase price with add-ons to be $42,000. The car is seen as a challenger to BMW’s 3 Series and similarly priced models from Daimler ’s ( DDAIF ) Mercedes-Benz, Volkswagen ’s ( VLKAY ) Audi and Toyota ’s ( TM ) Lexus, as well as electrics like General Motors ’ ( GM ) Chevrolet Bolt EV. Among the many things analysts and investors will be deconstructing is how much content from Tesla’s tech partners Nvidia ( NVDA ) and Mobileye ( MBLY ) go into the Model 3. Nvidia chips power the entertainment console in Tesla’s current vehicles. Mobileye is a maker of camera-based advanced driver assistance systems, and its technology is used by Tesla in conjunction with Autopilot self-driving car features. RELATED: Tesla Model 3 Reservations Hit 276,000 By Sunday

Tesla Model 3 Reservations Hit 276,000; Musk Considers Options

Loading the player…   Tesla Motors ( TSLA ) CEO Elon Musk tweeted Sunday afternoon “276k Model 3 orders by end of Sat.” The electric car was unveiled Thursday night after reservations for it opened around the world that morning. The pre-order count is far more than expected and Musk said Friday “definitely going to need to rethink production planning.” “All efforts focused on accelerating the ramp,” he added Saturday on Twitter ( TWTR ). Musk gives frequent updates as @ElonMusk there. He continued: “Token of appreciation for those who lined up coming via mail. Thought maybe 20-30 people per store would line up, not 800. Gifts on order.” 276k Model 3 orders by end of Sat — Elon Musk (@elonmusk) April 3, 2016 Will all those who forked over $1,000 for a Model 3 reservation pony up when it comes time to put in an actual order? “In-person store checks indicate huge optimism, but modest lack of conviction of actual purchase,” Pacific Crest Securities analyst Brad Erickson said in a research note written Friday and distributed late Sunday. “While there was clearly a lot of excitement and optimism around both the car and the company, roughly one-third of the respondents we talked to sounded undecided on whether they would actually purchase when the option came up in two years.” Erickson said that the “urgent need to reserve a place in line” seemed to stem most often from the view that the government tax credit “might expire before the customer would be able to take delivery.” Google CEO Weighs In The strong reception for Tesla’s Model 3 spurred a congratulatory tweet to the electric car maker’s CEO Friday night from Sundar Pichai, CEO of tech giant Google, a unit of Alphabet ( GOOGL ). He replied to Musk’s update on Model 3 reservations with: “congrats, exciting times!” . @elonmusk congrats, exciting times! — sundarpichai (@sundarpichai) April 2, 2016 The Model 3, like Tesla’s Model S and Model X, will have some Autopilot self-driving capabilities. Google famously has its Google Self-Driving Car in development, expected to be more a people transporter than a car that a human would drive some of the time. Musk said on Twitter that reservations expectations were “maybe 1/4 to 1/2 of what happened. No one at Tesla thought it would be this high before part 2 of the unveil.” @34thrain Maybe 1/4 to 1/2 of what happened. No one at Tesla thought it would be this high before part 2 of the unveil. — Elon Musk (@elonmusk) April 2, 2016 Musk plans another reservations update on Wednesday tallying the first week’s count. Model 3 Launch Event And Test Rides Tesla stock rose on Friday after Thursday night’s Model 3 launch party in Los Angeles tallied ramped-up reservations and revealed a good-looking design with glass on the back half of the roof clear all the way to the trunk. A reservations odometer actually spun at times during the event, moving past 134,000 while the afterparty was still going strong, outpacing the estimates of Tesla analysts. At $35,000 per car, that would amount to almost $4.7 billion in potential revenue when the Model 3 is actually delivered. The deposits are $1,000 a pop and said to be fully refundable. “According to management, reservation orders surpassed 150K during the evening (and presumably still growing beyond our two incremental reservations early this morning),” Stifel auto analyst James Albertine said in an overnight research note. That “is roughly 10x the 15-20K we expected in the first days of the launch and 50% greater than the 50-100K we expected by the end of this year.” He added: “Thoughts. We are simply awestruck by the demand surfacing for the Model 3.” CEO Musk tweeted out in early afternoon that reservations had nearly hit 200,000. Thought it would slow way down today, but Model 3 order count is now at 198k. Recommend ordering soon, as the wait time is growing rapidly. — Elon Musk (@elonmusk) April 1, 2016 Musk’s comment about the wait time is key. Model 3 production will take time to ramp up. Even if the deliveries begin in late 2017, as scheduled, it could be well into 2018 or beyond before people reserving today actually get their Model 3. Shares rose as high as 247.90 on the stock market   Friday, the best since early October. But gains cooled, with Tesla stock closing at 237.59, up 3.4%. Tesla is not currently highly ranked by IBD, with a Composite Rating of just 34 out of a possible 99, factoring in its earnings growth record, stock market performance and other metrics. The Model 3 pre-order window opened around the world Thursday at Tesla stores. “Orders for the Model 3 in the last 24 hours have just passed 115,000,” Musk announced at the 8:30 p.m. Pacific Time launch on Thursday. Lines at some Tesla stores had stretched far. The rest of the Thursday reservations were racked up during the event, where a bevy of Tesla Model S, Model X and Roadster owners conversed over the din of a DJ. “Orders for the Model 3 in the last 24 hours have just passed 115,000,” Tesla CEO Elon Musk just said. $TSLA #Model3 pic.twitter.com/ZWWb9LmhGj — Donna Howell (@IBD_DHowell) April 1, 2016 Several people IBD spoke with who already own at least one Tesla also ordered a Model 3 at the launch party. PCs were set up to take reservations online, with the general window for online reservations opening shortly before Musk took the stage to introduce the new car. Sleek, fast (we took a test ride) and smaller than its siblings, the  Model 3 is slated to roll off the assembly line in late 2017. It’s seen competing with the BMW 3 Series and similarly priced entry-to-midrange luxury vehicles from Volkswagen ‘s ( VLKAY ) Audi,  Daimler ‘s ( DDAIF ) Mercedes-Benz and Toyota ‘s ( TM ) Lexus, as well as electrics like the General Motors ( GM ) Chevrolet Bolt and a variety of hybrids. Tesla’s challenge now is ramping up production to meet the better-than-expected demand on time, and pushing down battery costs enough to profit with a car half the price of its last two models. About half of the current Tesla owners that IBD spoke with at the launch event expect the Model 3 to come out on schedule. The others wouldn’t bet on it. Tesla’s last model unveiling, also at its design facility in Los Angeles, was the Model X crossover in February 2012. After delays, that finally started going to reservation-holders at the end of September 2015. Bob and Linda Ashmore of San Carlos, Calif., have a Roadster and a Model S, and just put in a reservation for a Model 3. “We ordered one today here, so we’re looking forward to seeing what it’s actually going to look like,” Bob Ashmore told IBD as the launch party was getting started. He expects it to be built on time, and he and Linda have visited the factory several times. “They’ve got plenty of capacity,” Bob Ashmore said. “This has been a dream and vision of Tesla from the beginning,” Linda Ashmore said. “To get an affordable car for the masses.” Tesla isn’t highly rated by IBD at moment, though it has been in the past. The company currently gets a Composite Rating of just 34 out of a possible 99, factoring in its earnings and loss history, stock price performance and a raft of other factors. The stock has been finding support around its 200-day line lately, and hit its highest point since October on Friday. RELATED:  Tesla Motors Model 3 Revealed . This Is What It’s Like To Ride In A Tesla Model 3