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Tesla Exceeds Model S Sales Target, Scraps Lower-Range Model

By Chris Neiger - Apr 1, 2013 at 11:06AM

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Not enough demand for the 40 kWh battery pack.

Sales of the Model S exceeded earlier estimates by more than 5% in the first quarter, Tesla Motors (TSLA 1.66%) announced today. In mid-February, the company had put estimates for Q1 at 4,500 units, but the number ended up surpassing 4,750.

"As a result, Tesla is amending its Q1 guidance to full profitability, both GAAP and non-GAAP," said the company.

Tesla also announced today that it would not bring to market the lower-range Model S vehicles, due to low demand. Only 4% of customers chose the 40 kWh battery pack, according to the company, and that's not enough to justify production of that version. "Customers are voting with their wallet that they want a car that gives them the freedom to travel long distances when needed," Tesla said.

Instead of building low-range Model S units, customers who ordered the vehicle will receive the same 60 kWh battery pack as the longer-range models, but software will prohibit the larger battery pack from achieving the longer ranges. According to Tesla, the vehicles will "still have the improved acceleration and top speed of the bigger pack, so will be a better product than originally ordered, and can be upgraded to the range of the 60 kWh upon request by the original or a future owner."

The company also reported that all of the current and future 60 kWh battery pack models have been built with hardware that's compatible with Tesla's Supercharger charging feature that allows customers to have "unlimited, free long distance travel for life," if they upgrade to this option.

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