Tesla announced Thursday that it has received 375,000 preorders for its recently unveiled Model 3. If it sells every car that’s been reserved, the company says it will earn enough revenue to make this the “biggest one-week launch of any product ever.” A few days ago, the electric car company was saying it had received twice the number of preorders it originally expected to get. Now it’s quickly approaching three times that number, which raises questions about the company’s ability to meet its increasingly complex production goals.
$14 billion in implied future sales
If it can, it stands to make a boatload of money. Tesla says the number of preorders it has received so far corresponds to $14 billion in implied future sales. And it boasts that it was able to generate hype for the Model 3 without advertisements or “paid endorsements.” The company has raked in $375 million on just Model 3 deposits alone. Fortunately for those more fickle fans, the $1,000 deposit is refundable.
Elon Musk, the company’s CEO, unveiled the Model 3 at an event in Hawthorne, California, last Thursday, to much fanfare. Even before the car was revealed, hundreds of eager Tesla fans were lining up outside dealerships around the world. No doubt Tesla is hoping the news of its incredible preorders would overshadow the company’s announcement Monday that it was only able to ship 2,400 Model Xs last quarter due to its “hubris in adding far too much new technology.”
In Forbes this week, auto industry commentator Bertell Schmitt wrote that in all his years of covering cars, “I’ve never witnessed such a high number of reservations.” That said, he has his doubts that Tesla will be able to meet expectations, given the company’s poor track record in meeting its orders on time. “Tesla has grappled with production problems many times, even while in boutique production mode,” Schmitt notes.
But Musk is undeterred. In a Twitter Q&A the other day, the billionaire CEO said he expects the Model 3 to crack a half-a-million preorders even before part two of the car is unveiled later this year.
— Elon Musk (@elonmusk) April 3, 2016