3 am delivery: Tesla’s mad dash to make its quarter in China

Model 3 arrive in China. Picture courtesy Automotive News/Bloomberg

For the last two weeks, China has been the center of Tesla’s universe as the company is going all-out to deliver cars – and a better-looking quarter. After “closely monitoring delivery activities at all 7 of Tesla’s China delivery centers,” noted China analyst Junheng Li of New Yok based JL Warren Capital has up-revised her Q1 estimate of Model 3 deliveries to China, while noting that the following quarters likely will be less rosy.

Ms. Li now estimates that 6,780 Model 3 were delivered in China in the first quarter of the year. With Model S and X included, she expects the total to be 8,780 units. Tesla notoriously only supplies delivery data every three months, and it does not break them out by region, forcing Tesla-watchers to rely on estimates, or official registration data that become available only after a long delay.

Mad dashes to deliver cars before the quarter ends are common at Tesla, but this time, matters became even madder when Model 3 imports were held up in Chinese customs on a regulatory SNAFU. According to Junheng Li, “the first batch of M3s arriving in China were released by Customs on approximately March 14, and as such the first volume deliveries of the month of M3s took place the week of March 18th.” Some 14% of Tesla’s global deliveries went to China last year, making the country Tesla’s second-biggest market after the U.S.

Ms. Li letter to her subscribers says that “Tesla China has worked around the clock to push out deliveries.” According to the report, Tesla’s China operation occasionally resorts to what Ms. Li calls “forced deliveries.” Writes Ms. Li: “When owners have not bought insurance, and/or don’t have time to come to delivery centers, …continue reading