by Greg Klein | April 4, 2016
Over 276,000 advance orders in 72 hours will have Tesla Motors scrambling to keep up with demand for a car not even scheduled for production until late next year. The relatively economical Model 3 was advertised at US$35,000 “before incentives,” but CEO Elon Musk later tweeted that the average price would reach $42,000. That would mean $10.62 billion worth of orders in three days. Of course the celebrated company still has to build and deliver. But on April 4 the company boasted of delivering almost 50% more vehicles in Q1 than the same period last year despite “severe” shortages of six supplier parts for the Model X.
The company attributed the shortages to its own “hubris in adding far too much new technology to the Model X in version 1, insufficient supplier capability validation and Tesla not having broad-enough internal capability to manufacture the parts in house…. Tesla is addressing all three root causes to ensure that these mistakes are not repeated with the Model 3 launch.”
Meanwhile the company “remains on track to deliver 80,000 to 90,000 new vehicles in 2016.”
Evidently even some North Americans who travel the wide open spaces have warmed to electric vehicles, helped by a growing network of charging stations being supplied by Tesla, as well as the provinces of British Columbia, Ontario and Quebec. Canada now has thousands of public charging stations, CBC notes. But concerns about a lack of “charging station etiquette” have surfaced with reports that some drivers wander away while leaving their machines plugged in for hours.
Benchmark Mineral Intelligence analyst Simon Moores told MiningWeekly.com that Tesla’s first 24 hours of Model 3 orders alone might increase lithium hydroxide demand by 20% to 30%, assuming that the cars use a 60-kilowatt-hour lithium-ion battery—and that Tesla delivers.
In February Moores reported a 47% increase in this year’s lithium carbonate prices over the 2015 average.
Tesla has set a production goal of 500,000 cars a year, Musk told a swooning audience at the Model 3’s March 31 premiere. To achieve that, “we need to absorb the entire world’s lithium-ion production. That’s why we’re building the Gigafactory.” At 50 gigawatt-hours a year, the Nevada facility “will produce more lithium-ion batteries than all the other factories in the world combined.”
The Gigafactory has already begun operations, he added.