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Tesla Aus records profit, but Model 3 still delayed

Waiting game: Australian deliveries of the Tesla Model 3 will eventually kick off in the second half of next year.

Model X sales drive growth as Tesla Model 3 waits in the wings

Tesla logo18 Jun 2018

By DANIEL DeGASPERI

TESLA Australia has recorded a $1 million-plus profit for the second year running, but while revenue was three times higher in 2017 compared with 2016, the car-maker has faced some buyer cancellations for its new Model 3.
 
Although Tesla has not yet returned a global profit, figures from the Australian Securities and Investments Commission (ASIC) show that its Australian division recorded a year-on-year profit up $220,000 to $1.36m, derived from revenue that soared from $52.6m in 2016 to $160.7m in 2017.
 
While Tesla does not report Australian sales volumes to industry body VFACTS, its Model X large SUV only joined the existing Model S large car at the end of 2016, with 2017 the first full year of sales for both. 
 
However, the Californian-based car-maker will go without its Model 3 medium car for 2018 and, now, most of 2019, owing to delays that have resulted in buyer cancellations.
 
Revealed in April 2016 and slated for early-2019 right-hand drive production, the Model 3 has now been delayed for another three to six months.
 
Tesla senior manager of marketing and communications Heath Walker said that some local buyers had cancelled their order, but this was generally offset by new reservations.
 
“First (Model 3) deliveries happened in July of last year in the US, with right-hand drive production due to take place mid-2019,” Mr Walker told GoAuto at a media event in Sydney last week.
 
“There’s been fluctuations in (local) reservations up and down, but nothing of great significance. We don’t have people coming in here complaining of the delays, we’ve been very transparent around the time of the manufacturing and I think people are pretty keen to get their hands on the vehicle, but also willing to wait as well.
 
“We didn’t give a firm delivery date for those who put in a reservation … (but) I think most reports suggest that we’re about three to six months behind. So at the moment they (customers) have a reservation, and that will transition to an order once vehicles are set for production.”
 
Mr Walker explained that Tesla is instead, “encouraging people to come and look at Model S given the timeframe (of Model 3).
 
“It’s a compelling offer to hop into a used Model S, certainly, given that it has got removed luxury car tax (LCT). People have to be pretty quick as there’s not that many being traded in, but those that are, there’s huge demand for it.”
 
Asked when pricing would be set for the Model 3, Mr Walker replied: “We haven’t set pricing for this market and there are many reasons for that.
 
“Exchange rates can change, we try and keep price parity across all our products, and Elon (Musk, Tesla founder) has Tweeted that it will be price parity plus delivery and taxes locally, and that was very specific to AU (Australia).”
 
That means the US$35,000 entry-level Model 3 with a claimed 5.6-second 0-60mph (0-97km/h) and between 350km and 500km driving range, will, at current exchange rates, cost about $A46,900 plus on-road costs.
 
According to the Tesla US public website, Stateside reservations placed now will not be fulfilled for between four and 12 months, compared with seven to 14 days for the Model S.
 
As reported by GoAuto, Tesla had been struggling to hit its production target of 5000 Model 3s per week in order to fulfill an order bank that had grown to 373,000 by this time last year.
 
However, in a shareholder meeting earlier this month it said a series of production changes had helped it achieve this target, while claiming that the Model 3 had outsold the Mercedes-Benz C-Class in May 2018 in the US; while Tesla does not report sales figures, the C-Class achieved 5419 sales.
 
While Tesla is concentrating on the North American and European market with its Semi truck, Roadster reservations have commenced in Australia, with an anticipated 2020 delivery date. While the car-maker is aiming for a March 2020 unveiling of its Model Y small SUV, reservations have not yet opened locally.

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