Tesla Model 3 Deliveries Miss Estimates: Is this the time to worry for the company?

Tesla Model 3 is in the news again. However, this time it is more of a concern. On Thursday, the stock prices of Tesla had a sharp fall. This is because the deliveries of the first quarter missed the estimates.

Moreover, this is from a significant margin. This is not by any small number. In the first quarter Tesla produced 77,100 cars.

The estimate for production of Model 3 was 84,700. Moreover, 63,000 Tesla Model 3 have been delivered in the first quarter. The estimate however was of 74,900.

This is definitely a big reason for the company to worry about. Moreover, the stock prices are also falling. Therefore, the problem for Tesla is a serious one.

Tesla Model 3: Are the demands being affected?

The demand of Tesla Model 3 is being questioned. This is because the production and delivery numbers have missed the estimates.

Tesla Model 3 Deliveries
Tesla fails to reach production and deliveries numbers of the estimates
Source: Bloomberg

People are worrying that the demand might be slipping off for Model 3.

However, these concerns does not worry the company. This is because the demand for Model 3 is still strong.

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The company is fortunate to have the demand along with production and delivery strong.

What’s more is that the company hopes that its deliveries will increase. The number by which is about half a million. This is for every year.

Moreover, the company has positive forecasts for its deliveries. It forecasts that it will increase by 55 percent. This is for the fiscal year 2019. However, this is dependent upon the increase sale of Model 3 sedan.

Tesla Model 3 Deliveries
Tesla going strong because of Model 3
Source: The Street

Tesla going strong in each quarter

In the first quarter of 2019, Tesla produced 62,950 units of Tesla Model 3. The number in greater than fourth quarter of 2018.

In the fourth quarter of 2018 the number was 61,394. Therefore, there is an increase in quarterly production.

Therefore the investors must not worry much. This is especially for quarter to quarter fluctuation. Because Tesla does not advertise.

Therefore, the word-of-mouth strategy will take some time. This is for building the sales momentum.