This morning Tesla (TSLA -1.92%) shares jumped about 10% at the time of this writing. What's the backstory? The company shared some important updates at this week's Detroit Auto Show: Q4 vehicle sales and an update on its next big project, the Model X.
Model S
A Q4 update
Vice president of worldwide sales Jerome Guillen told the audience in Detroit that Tesla delivered 6,900 vehicles in the fourth quarter of 2013.
Source: Data retrieved from SEC filings and press releases
The number was somewhat of a surprise, considering that Tesla only guided for "slightly under 6,000 Model S vehicles." Assuming estimates for 5,900, Tesla's Q4 deliveries beat guidance by about 17%. That's Tesla's largest surprise for Model S deliveries ever -- by a solid margin.
|
Quarter |
Guidance |
Actual |
Surprise Factor |
|---|---|---|---|
|
Q1 2013 |
4,500 vehicles |
4,900 vehicles |
8.80% |
|
Q2 2013 |
5,000 vehicles |
5,150 vehicles |
3.0% |
|
Q3 2013 |
Slightly over 5,000 |
5,500 |
About 6.0% |
|
Q4 2013 |
Slightly under 6,000 |
6,900 |
About 17.0% |
Q3 and Q4 Model S deliveries in 2012 are not included in chart above. In both quarters, Tesla missed guidance. Source: SEC filings and press releases
"The two key drivers of demand were the superlative safety record of the Model S and great performance under extremely cold conditions," Tesla said in a press release this morning.
The Model S, heralded as the safest vehicle ever tested in the U.S., has helped Tesla continue its track record as the only manufacturer with "a perfect safety record of zero deaths or serious, permanent injuries ever." Including the Roadster, Tesla vehicles now boast a cumulative 200 million miles driven.
During the winter, Tesla did its best to educate consumers about the effectiveness of the Model S in winter conditions.
A Model X update
MLive asserts Guillen also claimed that the company is working "vigorously" on the Model X. The company plans to begin deliveries of the Model X in late 2014 in limited quantities, with a larger rollout in 2015. It's too late, however, for consumers to lock in a 2014 delivery, according to Tesla's website, which says the delivery estimate for new reservations is 2015.
The Model X is described as an SUV, though Tesla claims that it blends "the best of an SUV with the benefits of a minivan, as only an electric car can."
What's next for Tesla?
Though the jump in the stock price on this news signals greater optimism in the market for Tesla stock, the upside surprise does little to impact a long-term-investment thesis for Tesla stock. The market's optimism already prices in a stellar 2014 and a successful launch of the company's affordable vehicle, which has an estimated timeframe of 2016 or 2017.
That said, it's critical Tesla continues to exceed investors' expectations in production. As a supply-limited company with audacious goals for eventual mass-market appeal, Tesla's meaningful jump in production in Q4 shows investors the company is successfully addressing bottlenecks.
Though I won't be adjusting my investment thesis for Tesla stock on this news, it does give me a tad more confidence that the company is poised to continue to execute on levels that meet or exceed the market's expectations.
