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Tesla sold almost 6,900 Model S units in Q4; exceeds prior guidance by 20%

14 January 2014

Sales of the Tesla Model S in the fourth quarter of 2013 were the highest in company history by a significant margin. With almost 6,900 vehicles sold and delivered, Tesla exceeded prior guidance by approximately 20%. A higher than expected number of cars was manufactured as a result of an excellent effort by the Tesla production team and key suppliers, particularly Panasonic, the company said.

Tesla attributed the results to the “superlative safety record of the Model S” and great performance under extremely cold conditions. Including the Roadster, Tesla vehicles have now been on the road for almost six years in 31 countries with almost 200 million miles driven to date. Despite dozens of high speed collisions, the driver and passengers have always been protected, the company claimed.

Tesla attributed its cold weather performance to the the precision of its electric powertrain, which gives it outstanding traction control relative to the much higher latency and inertia of a gasoline powertrain. As a result, it is able to perform better on snow and ice than many all-wheel drive gasoline cars.

Tesla’s highest sales per capita are in Norway and the individual customer who owns the most cars lives in Narvik, which is above the Arctic Circle, the company noted.

A minor media kerfuffle broke out on Tuesday as the National Highway Traffic Safety Administration (NHTSA) acknowledged receipt of Tesla’s letter advising the agency, as required under law, of its over-the-air software update to provide greater control of charging when using the Universal Mobile Connector NEMA 14-50 adapters to reduce the risk of a garage fire. (Earlier post.) Tesla has also designed an improved wall adapter and will be delivering this to cutomers free of charge.

In acknowledging receipt of the notification, NHTSA labelled the campaign a “safety recall” by Tesla. (NHTSA Campaign Number: 14V006000)

The irrepressible Elon Musk objected to the use of the term “recall” and took to Twitter:

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Prior 'guidance'?

Closing in on 7000/Q for the Tesla Model S. One could imagine that future lower cost Models X and E could sell 4X to 5X as many if Tesla can manufacture that many by 2015/2016.

Panasonic (Japan and China) could probably produce 5 times as many batteries? Shipping to California, by containers across the Pacific, will probably not be a major challenge.

The excellent operation of he Model S, North of the Arctic Circle in Norway, is very good news for Tesla.

We will see if Tesla has staying power. They will put out the Model X and it will sell, but how many wealthy people are there who can buy a %100,000 toy on a whim?

I agree with SJC. I live in CA (central coast) area, have solar panels on the roof, and could use the supercharger network to travel to Bay Area or Santa Barbara or LA, our most frequent longer range destinations. I even have a 40 amp 240V plug in the perfect spot in our garage. Model S would work great for us. However, I cannot spend $100K on a car. Functionally equivalent Accord hybrid is ~$30K, for Chrissakes. Tesla will never be a mainstream manufacturer unless they can offer a compelling $25-35K car, IMHO, and I don't see them getting there any time soon.

SJC the Tesla Roadster may be called a toy as it has no room for luggage. However, the Model S is a real car that does everything you would want from a conventional car except refueling in less than 5 minutes. However, many people will gladly give up refueling in 5 minutes in exchange for being able to fuel at home or anywhere else you can find an electric plug.

So far Tesla is the only EV producer that is able to sell every car they can make. Nissan has capacity for making 250,000 Leafs per year yet they sold a misery 50,000 globally last year. GM could build at least 100k Volts per year yet they also only sold about 50k globally (including the Ampera edition of the Volt).

Tesla estimate they could sell 20k Model S in North America another 20k in Europe and another 20k in Asia. The Model X can probably do the same so that a total market of 120k globally per year might be possible for Tesla.

The most important way that the price of EVs are going to drop is by mass producing them. Strong sales of Model S and Model X will enable much higher production of battery cells at Panasonic so that they can lower their prices and still be equally profitable. That in turn will allow for a more affordable Model E but it will still cost much more than 30k USD. I think the global market for short range EVs like all the 80 miles EVs that are marketed right now is very limited. 99% of car buyers will not want to buy a 80 miles range EV with a 24kWh battery. My point is, to make real EV cars with 300 miles range you need about 85kWh of battery and this battery currently cost $44,564 at Tesla. A smaller Model E may be able to do with a 60kWh battery that currently sell for $37,102 at Tesla. If Tesla is successful and can get to 100k units in sales of their Model S and Model X they it may be possible to drop the battery price by 40% (my guess). That means the model E will get a 22k USD battery pack at 60kWh and the rest of the car could be made for another 20k USD. So a Model E could be produced for about 42k USD in 7 years from now if everything goes well at Tesla.

Tesla is in my opinion the only successful EV makes because they do not compromise with long range and because they offer lots of horsepower in their EVs. The fact is that one horsepower cost much less in an electric motor than in a combustion engine so this should be exploited by offering high power EVs not by offering low power 100kW engines or less as all other EV makers are doing. I expect the Model E to get a 200kW motor or so and do as well as the Model S in terms of the 0 to 60 mph. For that reason the 42 USD price tag will still look reasonably especially when you consider that your annual fuel expense is nearly nothing compared to an equivalent gas burner.


For cost of battery at Tesla see http://www.greencarreports.com/news/1089183_life-with-tesla-model-s-battery-upgrade-from-60-kwh-to-85-kwh/page-3

As the saying goes, "we will see". Lots of projections and predictions are made, but there is only one reality.

Only one reality?
Just say: 'Yes!' ;-)

A new very large Panasonic battery factory will open soon in China. If all goes as planned, 24/7 mass production cost could be 40% to 50% less.

BYD has the potential and possibility to do the same.

Those two (and many other) battery manufacturers could produce batteries for Tesla's Models X and E etc at less than half current price by 2016 or so.

That being said, it is fair to think that many Tesla's future BEVs, specially the made in China units, will be much cheaper to buy, probably close to $40K.

Only one reality, everyone takes their guess, few if any are totally correct.

@Henrik,

I believe that SJC is right. Future growth of Tesla will depend on reducing the price by quite a bit, perhaps by reducing the battery size by quite a bit, perhaps down to 10 kWh, just enough for a PHEV. The battery will then be built to be capable of 10-20C, or 100 to 200 kW of power.

Perhaps the reason that Tesla has not offered a current ICE-PHEV because the integration of the ICE and the electric drive train in a parallel-serial architechture is quite difficult and will take a lot of R&D money and time. For that reason, Fisker offered only a serial ICE-PHEV hybrid (serial hybrid), but Fisker failed to deliver the efficiency because serial hybrid is a lot less efficient than a serial-parallel hybrid. I've predicted this during the development of the GM-Volt when the Volt was announced to have a pure serial hybrid drive train. Luckily for GM, who chose instead to later incorporate a parallel component to the Volt drive train and was able to maintain adequate degree of efficiency to the Volt.

Beyond 2015, perhaps around 2017, we will see FCV's starting to appear, and along with that, H2 stations at regular intervals along major Hwys. So, range extender of future Tesla could come from a small FC stack and an H2 tank capable of 200 mile range, or ~3kg.

So, a hypothetical luxury sporty FC-PHEV will have 200 kW of battery power using a 10-kWh battery pack with a 50-kW FC stack and an H2 tank good for about 200 miles, or about ~3kg, in order to keep the tank size down and preserving internal space. The smaller size of the tank and of the FC stack will make up for the presence of the large 10-kWh battery pack. So, this car be capable of 250 kW of maximum power, 200 kW from the battery, while 50 kW from the FC stack, or 336 hp, so it will accelerate pretty fast!

This will be more than twice as fast as the FCV offerings from Toyota, Honda, Huyndai, GM, M-B, VW, etc...and will permit the PHEV to be sold in the high-end luxury-sport market and is completely commercially competitive w/ high-end ICEV's, without any compromise. Otherwise, if a near-future FCV will be priced at above $50,000 and has only 100 kW of power, this will turn off a lot of high-end luxury buyers wanting a lot of power in a car!

While the owner will have the option to plug it in once a day for about nearly 30 miles of commute, or plug it in twice daily for about nearly 60 miles of AER, he/she can also elect to just run it solely w/ H2 at the filling station and fill it up every 7-10 days or so and not having to plug it in at all. In the latter case, the large battery pack is just to allow the car to sprint real fast while able to brake real fast and still able to capture most of the kinetic energy.

In a FC-PHEV, the drive train is very simple and is purely electrical, so Tesla should not have any valid excuse not to offer a future FC-PHEV in the coming Models X or E, after 2017, when H2 filling stations will be in sufficient numbers!

By reducing the battery pack from 85 kWh down to 10 kWh, while adding minimum amount of FC and H2 tank for much less cost and weight than the remaining 75 kWh battery pack, perhaps the next FC-PHEV will be able to have same range as the current 85-kWh Tesla, yet can be available for half the price while still maintain healthy profit margin for Tesla? For the same quantity of battery material, Tesla will be able to build 8x the number of cars if a FC-PHEV model will be decided upon.

Roger thank you for your comments.
Tesla has given the range extender option some thoughts but opted not to pursue it. Tesla has no patens nor expertise in either combustion engines or fuel cells and it will cost billions of USD to get enough patents and expertise to be able to make a useful range extender. They do not have that money and what money they have need to be invested in expanding the production volume in order to meet the demand for their vehicles. They could license the range extender technology but that will not be profitable in the long run and Tesla is in it for the money as are all other commercial companies. Instead Tesla do what they do better than everybody else and that is large battery packs, high power motors and their associated power electronics. They already have lots of patents and expertise in this area and in this way they can maintain a lead over their competitors that also would like to produce long-range performance BEVs with lots of trunk space.

Instead I will elaborate a little on the cost dynamics of the Tesla battery pack because they are not obvious. Note that the 60kWh pack cost $37,102 and the 85kWh pack cost $44,564. In other words you get 25 kWh more battery for just 7462 USD ($44,564-$37,102) or just 300 USD per kWh (7462/25). This is the cost of the cells used in the battery pack. In other words, the 85kWh pack contains 25500 USD (300*85) worth of battery cells whereas the remaining 19000 USD (44500- 25500) is used 1) to produce the battery pack 2) to account for profit, 3) to account of insurance allowances (cost of inevitable battery recalls) and 4) to finance the cost of providing Tesla owners free electricity for life when using the Tesla supercharger network. Note that the 60kWh battery also cost 19,000 USD plus cost of cells that are 300*60 = 18,000 USD or 37000 USD in total.

Tesla can reduce the price of producing the battery pack and the cost of the cells only by increasing volume allowing for more automated production at both Tesla and Panasonic. This is why volume growth is the number one priority for Tesla. Spending time developing range extenders is not a priority nor are they needed to make a competitively priced long-range performance BEV with lots of trunk space. The competition from combustion cars with similar specs are equally expensive because their motors and transmissions are really expensive to make for such cars.

Another alternative for TESLA's future FCEV option would be using an already developed small FC (10 to 20 KW) from Toyota together with their own downsized battery pack.

A Toyota/Tesla JV already exist for e-RAV4 and could certainly be expanded to cover future Tesla and Toyota FCEVs or PHEVs with FC range extended?

Tesla and Toyota could share future combinde H2/Quick e-charging stations.

Good point, Harvey D.
What ever that's not practical to develop in house can be outsourced. Cooperation or joint venture w/ Ballard for the FC stack, and with Quantum for the H2 tank would be another option if Toyota refuses to cooperate. Toyota has cooperated with GM before in the production of the later model Chevy Nova which was based on the Corolla, built in the NUMI plant, California.

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