Interpreting 276k pre-orders of Tesla Model 3

276 000 pre-orders for the Tesla Model 3 within 3 days – it is hard to overestimate the significance of this signal. It shows two things:

  • There is a marktet for electrical cars today, and it’s huge
  • Tesla pretty much meets the customer requirements for a lot of people, in terms of
    • range: 350 km
    • form factor and measurements (no SUV!)
    • design: elegant sporty (not futuristic!)

The deposit of 1 000 Dollar is cleverly chosen: the amount is low enough to be parked for a future investment without impacting current spendings and high enough to make it only reasonable for people with a real willingness to buy.

This order intake with enormous value (276k * 42k Dollar average selling price = 11.6 Billion Dollar), should make it quite easy for Tesla to walk into a bank and get the money necessary for building up the production capacity at a very low interest rate. This means the production ramp up will be earlier due to high pre-orders. And this means that Tesla is able to improve on its only competitive weakness. I think I am not going too far with my interpretation of that signal predicting that Tesla will stay on top of the electrical car market as it turns mainstream.

My article on Tesla from 06/2014