Please ensure Javascript is enabled for purposes of website accessibility

How Many Vehicles Will Tesla, Inc. Deliver in Q1?

By Daniel Sparks - Mar 20, 2017 at 5:06PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Without any specific guidance for the first quarter, there's significant uncertainty surrounding Tesla's potential deliveries.

Next week, Tesla (TSLA -0.32%) will close its first quarter. That means the electric-car maker will soon share its total quarterly vehicle deliveries.

Ahead of Tesla's first-quarter update on vehicle deliveries, here's a close look at what investors know.

Tesla vehicles outside of Tesla factory.

Tesla vehicles outside of Tesla factory. Image source: Author.

A wildcard quarter

Typically, Tesla investors have some solid visibility into potential vehicle deliveries for a given quarter. But there's much more uncertainty surrounding this quarter's possible deliveries than usual, as Tesla opted to only provide guidance for the first half of the year -- without specifying what it expects for the first quarter.

For the first half of the year, Tesla said it expects to deliver 47,000 to 50,000 Model S and Model X vehicles combined, up 62% to 72% compared to same period in 2016.

Investors also know that Tesla ended its fourth quarter with a record 6,450 vehicles in transit to customers, setting the company up for a strong start to the quarter. Tesla also said demand for its vehicles is looking up; orders for the Model S and Model X combined were up 49% year over year and were 24% higher than any other quarter, management said.

But even this information still leaves lots of room for guesswork since quarterly deliveries can also be influenced by the timing of shipments to different regions, as well as by production challenges. The best ballpark figure investors can arrive at for estimating Model S and Model X deliveries in the first quarter, therefore, is one that simply cuts Tesla's forecast for the first half of the year in half. Assuming Tesla delivers half of its 47,000 to 50,000 estimated units for the first half of the year in Q1, it would imply 23,500 to 25,000 deliveries during the quarter -- up from 22,252 deliveries in the fourth quarter of 2016 and 14,820 units in the first quarter of 2016.

Investors should look for Tesla's first-quarter deliveries to be between about 23,500 and 25,000. But since this estimate is extrapolated from guidance for a broader period, investors shouldn't be surprised if actual deliveries deviate from this estimate. If deliveries do come in below or above this level, investors may want to look into a reason for the variance.

Look for an update on demand

Beyond Tesla's reported deliveries in its upcoming update, which is usually released within three calendar days of the quarter's close (anywhere between April 1 and April 3), investors may want to look for an update on demand for Model S and Model X.

A silver Tesla Model 3 driving down a country road.

Model 3. Image source: Tesla.

In Tesla's quarterly update on deliveries, the company has recently been sharing data for orders of the two vehicles. In its update on fourth-quarter deliveries, for instance, investors learned that Model S and Model X deliveries were increasing sharply year over year and were at an all-time high.

A look at demand levels for Model S and Model X during the first quarter would be timely since Tesla is preparing to bring to market its $35,000 Model 3 in the second half of the year. With a starting price about half of Tesla's more expensive Model S and Model X, there's good reason to be concerned about Model 3 cannibalizing sales of Tesla's two older, pricier models.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Tesla, Inc. Stock Quote
Tesla, Inc.
$734.76 (-0.32%) $-2.36

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/27/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.